According to a report on Friday, Intel (INTC) is about to spin off its networking unit as the struggling chipmaker moves to flow assets under the direction of new CEO Lip-Bu Tan.
Intel has already begun the process of courting strategic investors in the Network and Edge Group, and has notified customers this week, CRN reported. Intel told CRN it intends to remain a “anchor investor” in its business. The transaction recalls Altas, a programmable chip unit that Intel agreed to sell 51% of its stake to a private equity company in April.
Intel did not immediately respond to Investopedia’s request for comment.
Tan, who took the helm of Intel in March, said he would consider reducing non-core assets and streamlining his business as part of his efforts to design turnarounds. His previous moves included layoffs, the end of previously planned projects in Germany and Poland, and slowing down the already delayed construction of a new facility in Ohio.
“I’m not subscribing to the belief that if you build it they’ll come,” Tan told investors on Thursday’s revenue call, raising concerns that Intel’s cost discipline under Tan could mean a long recovery and could hinder his ability to keep up with his competitors.
Intel shares fell almost 9% on Friday after chipmakers announced losses. Drop erased most of the profits of the stock that year.
