Signage outside Intel headquarters in Santa Clara, California, Jan. 30, 2023.
David Paul Morris | Bloomberg | Getty Images
Intel on Wednesday terminated its acquisition of Israeli chipmaker Tower Semiconductor, saying it failed to secure the required regulatory approval.
The tech giant said in a statement it is scrapping the planned deal “due to the inability to obtain in a timely manner the regulatory approvals required under the merger agreement.”
The U.S. chip giant will pay a termination fee of $353 million to Tower.
Intel announced intentions to buy Tower — a contract chipmaker that manufactures semiconductors for other companies — in February 2022 for $5.4 billion.
The deal would have given Intel a foothold in the specialty technologies on which Tower focuses, like radio frequency and industrial sensors.
Tower Semiconductor shares were down 8% around 4:18 a.m. ET.
Reuters, citing people familiar with the matter, reported on Tuesday that Intel did not secure approval for the deal from the Chinese authorities before the deadline passed. Chinese authorities have not publicly communicated approving the purchase.