IFS and Tower Announce New Agreement for New Mexico Capacity

Under the agreement, Tower will utilize Intel’s advanced manufacturing facility in New Mexico. Tower will invest up to $300 million to acquire and own equipment and other fixed assets to be installed in the New Mexico facility, providing a new capacity corridor of over 600,000 photo layers per month for Tower’s future growth, enabling capacity to support forecasted customer demand for 300mm advanced analog processing.

https://www.intel.com/content/www/us/en/newsroom/news/sept-2023-manufacturing-news.html

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Tower’s forgiving the deal termination fee (the difference is probably management kickbacks).

How will Tower lots be prioritized in New Mexico? Can Intel lots run on Tower tools? Suppose a competitor of Tower becomes an IFS customer. Can the competitor's lots run on Tower tools? So many questions.

This sounds like exit clause from acquisition termination.

Could be provision in the acquisition agreement in case the deal falls through..

imagine you are Tower... you say, ok Intel you can acquire us... but in event the deal falls through we will be stuck as we need capacity for manufacturing...

there ya go. I have no inside information on this deal but I do have deal making skills of this type. so, this is 100% speculation but i think this is plausible

The Fab probably isn’t doing much. Tower needs to retool it for its own use.

Agreed. I don’t get it either, what is the strategy?

I’ve read the news on this multiple times… I don’t get it… Tower places $300 million of their tooling into Intel’s building(s)… and somehow this is good for Intel… unclear at best…

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IFS and Tower Announce New Agreement for New Mexico Capacity

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