Intel (INTC) shares are up in trading session Monday after the stock was reported to be sold in the Altera Chips unit. Intel sells a 51% stake in the Altera Chips unit to Silver Lake, a high-tech, private equity company. The deal valued Altera at $8.75 billion, leaving Intel with a 49% stake.
Intel’s Altela’s programmable chip business generated revenues of over $1.5 billion last year, with adjusted operating profit of $35 million. “Today’s announcement reflects our commitment to sharpen our focus, lowering our cost structure and strengthening our balance sheet,” Intel CEO Lip-Bu Tan said Monday. Intel also said that Raghib Hussain will become effective Altera CEO on May 5th. Assets, including Intel’s stock, including Altera stock, are at the heart of Tan’s strategy as their predecessors have not diversified beyond their flagship PC and server chip business over the years.
Intel (INTC) and Silver Lake agree to the transaction
Silver Lake and Intel are hoping to close later this year. The report has increased Intel’s (INTC) inventory by 6% in recent transactions. At the time of press, INTC has risen by more than 3%, sitting at about $20.57 per share. The chipmaker plans to report first quarter results after the market closed on April 24th.
Intel is also rising after tech stocks have moved widely for their second straight session, following the US decision to delay tariffs on major appliances. The temporary relief sparked optimism across the market, sending shares like INTC. Despite the market bounce, concerns continue to rise. John Canavan, a US analyst at Oxford Economics, said the lack of a consistent trade strategy continues investor sentiment to the cloud, adding that volatility could remain high as the market has more uncertainty.
On Monday, INTC was below the 200-day simple moving average near the bottom of the 52-week range. CNN analysts aren’t sure this climb will last long. It cites economic/tax uncertainty and strengthening competition in the technical field. Of the 44 analysts surveyed by CNN, 84% suggest that they hold shares and not buy or sell.
