Intel on Wednesday said it will buy back a 49% equity interest in a joint venture related to its Fab 34 facility in Ireland for $14.2 billion. The Santa Clara, California-based company plans to fund the repurchase from Apollo through a mix of cash on hand and $6.5 billion in proceeds from new debt. Intel initially sold the stake nearly two years ago, creating the “financial flexibility” to invest in other parts of the company. Ireland and Fab 34 are a key part of Intel’s global manufacturing footprint and current and future roadmap. The chipmaker said the repurchase signals an improvement in its overall balance sheet, driven in part by artificial intelligence momentum.

In 2024, Intel moved to start a joint venture with Apollo related to its Ireland factory as part of its Semiconductor Co-Investment Program under the leadership of former Intel CEO Patrick Gelsinger. Fab 34 construction was nearly completed at the time and had begun manufacturing processors on Intel 4 technology the year prior.

Apollo acquired the minority interest for $11.2 billion under the agreement that Intel would finish building out Fab 34 and purchase wafers from the joint venture for itself and external customers on a “cost-plus-margin” basis. Intel retained a 51% controlling interest in the joint venture as part of the deal, as well as full ownership and operational control of Fab 34 and its assets.

“Our 2024 agreement was the right structure at the right time and provided Intel with meaningful flexibility, enabling us to accelerate critical initiatives,” Intel CFO David Zinsner said in a statement. “Today, we have a stronger balance sheet, improved financial discipline and an evolved business strategy.”

At the time, the deal allowed Intel to redeploy capital to accelerate the buildout of its Intel 4 and Intel 3 technology used for manufacturing in Europe, the company said. It also allowed Intel to invest in its most advanced processing technology used in U.S. manufacturing today, known as 18a. “We’re proud to support Intel’s evolving strategic and operational priorities and look forward to pursuing additional opportunities to work together over time,” Apollo Partner Jamshid Ehsani said in a statement.

Intel plans to continue investing in its Ireland campus to expand manufacturing capacity and meet growing demand for AI-driven systems, the chipmaker said. Fab 34 produces Intel Core Ultra and Xeon 6 processors using Intel 4 and Intel 3 technologies.

The repurchase comes as U.S. chipmakers navigate supply and production limitations due to surging demand for data centers and AI-driven applications. On a January earnings call, CEO Lip-Bu Tan said he was “disappointed” that Intel could not fully meet customer demand, citing capacity constraints. He also said that his team is “working tirelessly” to drive efficiencies and increase output.

Regaining full interest in its Ireland factory would lower Intel’s production costs during an AI boom cycle. An Intel spokesperson did not immediately respond to a request for comment about the impact the repurchase could have on U.S. operations.

By: DocMemory
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