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The US activist hedge fund urged the US Integrated Semiconductor Company (IDM) Intel to come up with alternatives in terms of structural reform, saying “it was pushed over by Samsung Electronics and Taiwan TSMC.”
According to Reuters on the 29th (local time), CEO Dan Love Thirdpoint sent a letter to Intel’s board of directors on the same day.
Third Point is an activist hedge fund that seeks an investment strategy that raises corporate value by buying corporate stocks to secure voting rights and then demanding improvements in governance structure and dividend expansion. It is reported that it recently bought 1 billion dollars worth of Intel stock.
In a letter, CEO Rob said, “The loss of leadership in the manufacturing sector and other mistakes made semiconductor competitors rely on the technology of TSMC and Samsung Electronics, and they drastically lost the market share of Intel.” “AMD is the central processing of PCs and data centers. It is eating up Intel’s share in the device (CPU) market.”
“Without Intel’s immediate change, the US’s access to state-of-the-art semiconductor supplies weakens, and the US could become more dependent on geopolitically unstable East Asia to run everything from PCs to data centers and critical infrastructure. I am concerned that there will be.”
“Intel will have to hire investment advisors to explore strategic alternatives even now,” he added. “Now, we have to shake off the semiconductor production sector, and we will have to consider disposing of the failed ones among the acquired companies.”
While Samsung Electronics and TSMC are competing for a 5 nanometer (nm) ultra-fine process, Intel has been competing with other companies to the extent that it has not yet been able to produce 7-nano class semiconductors, which are the next generation semiconductors that AMD, CPU rival, is commissioned to produce through TSMC. There is a significant technological gap.
As Intel struggled with the transition to ultra-fine processes, Apple and Microsoft (MS), which had maintained long-term cooperation with Intel, decided to cut off their reliance on Intel this year and use their own designed semiconductors in earnest to develop their own chips. It is in a spiral state.
Intel made a statement on the same day regarding the letter from Third Point, saying, “We welcome all investors’ opinions on improving shareholder value. We look forward to cooperating with Third Point for this purpose.”
Intel’s stock price rose about 5% during the week on the New York Stock Exchange on the day after the report on the Third Point. However, as of this year, Intel’s share price has already fallen by 18%. On the other hand, the stock price of its rival AMD has nearly doubled.
Seongsu Bae, reporter of Hankyung.com [email protected]
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