Chinese Regulators Block Intel Deal, Spotlighting US Chip Strategy

After Chinese regulators stalled the deal for almost a year, Intel on Tuesday abandoned its attempted acquisition of Tower Semiconductor, a chip manufacturer that was going to help Intel make semiconductors in-house. The plan was part of Intel’s strategy—which aligned with President Biden’s CHIPS and Science Act—to manufacture semiconductors domestically.

Beijing had the authority to delay the Intel deal because China requires that its State Administration of Market Regulation approves mergers if one of the companies has significant business interest in the country. (Intel operates factories in China, and the country is one of its biggest markets. It made almost $23 billion in China in 2021.)

SAMR had incentive to obstruct the deal because of the now-apparent geopolitics of the chip sector, which Beijing believes has held it hostage to a growing international contingent of countries interested in curbing China’s economic success. The other word for it is “containment”—a term the United States seems increasingly willing to openly deploy in its China policy.

Read the whole article via Forbes here.