Reuters
- Activist hedge funds sent a letter to the chipmaker through Third Point, after which Intel raised 8% on Tuesday, according to Reuters.
- Third Point, managed by Daniel Loeb, has amassed a ડો 1 billion stake in Intel, according to Reuters, adding that people are aware of the matter.
- “Without immediate changes to Intel, we fear that access to America’s leading Edge semiconductor supply will be disrupted, forcing the US to power everything from PCs to critical infrastructure on geographically unstable East Asia,” the letter said. .
- Watch Intel Trade Live here.
Intel raised 8% on Tuesday after a letter was sent to the chipmaker by activist hedge fund Third Point, according to Reuters.
Third Point, owned by billionaire investor Daniel Loeb, has acquired a 1 billion stake in Intel, Reuters quoted people familiar with the matter as saying.
According to a letter reviewed by Reuters, it is calling for immediate action from Intel chairman Omar Ishraq to enhance the company’s position as a provider of processor chips for Third Point, PCs and data centers.
“Without an immediate change in Intel, we fear that access to America’s leading edge semiconductor supply will be disrupted, forcing the US to power a physically politically unstable East Asia on vital infrastructure from PCs to data centers and so on.” Said the letter.
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Third Point believes that in a possible move for Intel the company will separate its chip design from its semiconductor manufacturing operations and may include a joint venture in production.
In recent years, Intel has been losing market share of advanced micro devices, and has lost major customers such as Apple Pal as companies develop their own chips domestically and outsource manufacturing to East Asia.
According to Loeb, Intel has lost its pole position in microprocessor manufacturing to Taiwan Semiconductor Manufacturing Co. and Samsung Electronics.
The company has focused on its “human capital management issue” on the second avenue for change at Intel, with many of its chip designers fleeing in recent years, “the letter said.”
In a statement, Intel responded to Third Point’s letter and said, “Intel Corporation welcomes all investors’ input regarding enhanced shareholder value. In this spirit, we look forward to joining Third Point LLC on their ideas towards that goal.”
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