Intel has reportedly turned down an offer from ARM to buy its manufacturing unit

Intel’s fortunes have fallen so rapidly in the past year that chip designer ARM has made a “high-level inquiry” into buying a unit of its prized product, Bloomberg report. However, Intel said the unit was not for sale and rejected the offer, according to an unnamed insider.

There are two major units within Intel, the product group that sells PC, server and network chips and the chip manufacturing base. ARM had no interest in Intel’s foundry division, according to Bloombergsources. Representatives for ARM and Intel declined to comment.

Intel’s fortunes have been on the decline for years, but the decline over the past 12 months has been surprising. Following a net loss of $1.6 billion in Q2 2024, the company announced it is laying off 15,000 employees as part of a $10 billion cost-cutting plan. Last week, the company also revealed plans to spin off its old business into a private company. Intel lost half of its market value last year and is now worth $102.3 billion.

ARM sells its designs (mostly for mobile phones) to Qualcomm, Apple and other manufacturers but does not manufacture any chips itself. Buying Intel’s product division would completely change its business model, although that scenario seems highly unlikely.

With Intel currently injured, competitors have been circling. Qualcomm also expressed interest in acquiring Intel recently, according to a report last week. Any merger involving ARM and Qualcomm would be a regulatory nightmare, but the fact that the offer exists at all shows Intel’s vulnerability.

Intel has other ways to improve investment. Apollo Global Management (owner of Yahoo and Engadget) has pledged to invest up to $5 billion in the company, according to a recent Bloomberg report. Intel also plans to sell part of its stake in chip maker Altera to private investors.