Activist Fund Third Point Asks Intel To Explore Strategic Alternatives

(RTTNews) - Third Point, the activist hedge fund led by Dan Loeb, has asked chipmaker Intel Corp. (INTC) to explore "strategic alternatives".

The fund has asked Intel to consider whether to divest or outsource its manufacturing capacity. Third Point reportedly has a significant stake in Intel worth $1 billion.

"The loss of manufacturing leadership and other missteps have allowed several semiconductor competitors to leverage TSMC's and Samsung's process technology prowess and gain significant market share at Intel's expense," Loeb wrote in the letter to board.

AMD, which currently leads the chip industry, outsources its production to Taiwan-based TSMC, a company that also makes chips for Apple and Nvidia. In July, Intel CEO Bob Swan had said the company was open to outsourcing its manufacturing.

"Without immediate change at Intel, we fear that America's access to leading-edge semiconductor supply will erode, forcing the U.S. to rely more heavily on geopolitically unstable East Asia to power everything from PCs to data centers to critical infrastructure and more," Loeb wrote in the letter.

In a statement, Intel said it would work with Third Point on its ideas to increase shareholder value.

"Intel Corporation welcomes input from all investors regarding enhanced shareholder value. In that spirit, we look forward to engaging with Third Point LLC on their ideas towards that goal," Intel's statement said.