Intel to offer Tower foundry services after failed acquisition

6 Sep 2023

Image: © Katherine Welles/

A deal to acquire Tower had to be cancelled by Intel last month due to a lack of approval from Chinese antitrust regulators.

Intel has said it will offer Tower Semiconductor foundry services in a new deal after its bid to acquire the Israeli chipmaker fell through last month.

In an announcement yesterday (5 September), Intel said it will also provide Tower with 300mm chip-manufacturing capacity through its advanced manufacturing facility in Rio Rancho, New Mexico.

As part of the deal, Tower will acquire and own equipment and other fixed assets to be installed at the Rio Rancho, New Mexico fabrication unit, giving it production capacity of over 600,000 photo layers per month at the site to support demand for next-generation 300mm chips.

Tower CEO Russell Ellwanger said that the latest collaboration with Intel “allows us to fulfil our customers’ demand roadmaps” with a focus on advanced power management and radio frequency silicon on insulator tech.

“We see this as a first step towards multiple unique synergistic solutions with Intel,” he said.

Intel had first announced its intention to acquire Tower Semiconductor for $5.4bn in February last year as part of its IDM 2.0 strategy to combine its existing internal factory network with third-party capacity as well as new Intel foundry services amid increasing competition.

However, the deal had to be cancelled due to a lack of approval from Chinese antitrust regulators by the deadline of midnight, 15 August. This is likely a result of recent tension between the US and China, as a trade war between the two countries has been steadily escalating.

Intel also recently announced an extension of its partnership with chip designer Synopsys to bring new intellectual property and automation services to Intel’s Foundry Services.

Israeli prime minister Benjamin Netanyahu said in June that Intel plans to invest $25bn in Israel to build a new chip factory, calling it the largest-ever international investment in the country. Intel also said it will build a new $4.6bn chip plant in Poland to meet growing European demand.

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Vish Gain is a journalist with Silicon Republic