[News] U.S. FPGA Peer Lattice Reportedly Explores Acquisition of Intel’s Altera Unit

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While rumors have been circulating that Intel is seeking to sell at least a minority stake in Altera, one of its FPGA (Field Programmable Gate Array) peers seems to be interested in the unit. Lattice is reportedly exploring a potential bid to acquire Intel’s Altera unit in its entirety, according to sources cited by Bloomberg.

Bloomberg indicates that Lattice is working with advisers and seeking private equity backing to support its potential offer. It is also worth noting that bids for Altera are expected to be submitted next week, ahead of the U.S. Thanksgiving holiday on Thursday, according to sources cited by the report.

A decision might be made soon, as the future of Altera was a key topic of discussion during a regularly scheduled board meeting this week, according to Bloomberg. Intel reportedly favors selling a minority stake in Altera rather than divesting the entire unit.

Lattice may not be the only buyer that shows its interests. According to Bloomberg, buyout firms such as Francisco Partners, Bain Capital, and Silver Lake Management have been evaluating potential investments in Altera, while the unit may also draw interest from other semiconductor companies.

Qualcomm, another tech giant who has expressed its interest in acquiring Intel, is said to be investigating the possibility of acquiring parts of Intel’s design business to enhance its product portfolio, according to a previous report from Bloomberg. Whether the development of the Altera sale cause an impact to the potential deal remains to be seen.

The Bloomberg report further suggests that offers for a stake in Altera would likely require complex financial arrangements. Notably, private equity firms are reportedly considering investments of around USD 3 billion, potentially structured through specialized instruments. This approach could result in a valuation lower than what Intel originally paid for Altera, according to sources cited by the report.

Intel CEO Pat Gelsinger has stated that the company aims to finalize the Altera transaction early next year while also evaluating strategic options for other parts of its portfolio, according to Bloomberg.

More Challenges ahead for Lattice, with Complications Inside and Outside

According to a previous report from CNBC, Intel aims to strike a deal that values Altera at approximately USD 17 billion, an amount approximately equivalent to the USD 16.7 billion Intel paid to acquire Altera in 2015.

Therefore, given Lattice’s comparatively smaller size with a market value of USD 7.48 billion, the firm’s ambition to take full control of Altera could face challenges, Bloomberg notes.

Meanwhile, the U.S.-based FPGA firm seems to be struggling with improving its own financial situation. According to an earlier report from Hillsboro NewsTimes, Lattice revealed a 14% reduction in the company’s workforce in its quarterly earnings report released in early November, citing a significant decline in sales and profits.

The company, which specializes in programmable chips for telecommunications, industrial equipment, and consumer products, currently employs approximately 1,150 people worldwide, meaning it plans to let go around 160 employees, Hillsboro NewsTimes notes.

Read more

• [News] Intel Reportedly Aims to Raise Billions through Sale of Minority Stake in Altera
• [News] Intel Mulls Sale of Altera Stake, while Silver Lake and Bain Reported as Potential Buyers

(Photo credit: Intel)