April 1 (Reuters) - Intel said it would spend $14.2 billion to buy back the 49% stake it sold to Apollo Global Management in its Ireland manufacturing facility, taking full ownership of the plant as its finances improve and AI drives demand for its processors.
Intel shares rose 1.5% in premarket trading.
Apollo had in 2024 spent $11.2 billion to acquire the stake in a joint venture related to the plant in Leixlip, Ireland, giving the then-struggling chipmaker a cash infusion to fund its manufacturing expansion in Europe and the United States.
Intel has since changed CEOs, with current top boss Lip-Bu Tan pursuing an aggressive restructuring to repair the company's finances, including job cuts and asset sales. The company has also received billions of dollars in investments from Nvidia and the U.S. government, which is now its biggest shareholder.
After sitting out the artificial intelligence boom for nearly three years, demand is also rising for its central processors used in data centers due to the rise inference, the process by which AI tools respond to user queries.
"Today, we have a stronger balance sheet, improved financial discipline and an evolved business strategy," Intel Chief Financial Officer David Zinsner said on Wednesday.
Intel said the stake buyback would be funded with cash on hand and about $6.5 billion of new debt. It expects the deal to boost profit and strengthen its credit profile from 2027.
The Ireland plant, known as Fab 34, produces chips based on its Intel 4 and Intel 3 technologies, including Core Ultra and Xeon 6 processors.
