The technology giant has invested millions of dollars since 1991, now its considering selling some of its venture capital assets at a price of $1 billion.
The world’s largest maker of computer component, Intel Corporation is planning on selling its venture capital unit assets which could be worth as much as $1 billion, according to a person familiar with the matter.
The people close to the matter further stated that the technology giant is currently looking for potential buyers for the unit with the help of UBS Group AG. Since the information is presently private, the people who disclosed the news asked not to be named.
This move by the company has come two months after Arvind Sodhani, the president took retirement after a long 35 year period from the tech giant. The retirement came as an abrupt change in the unit due to which the biggest chipmaker in the industry had to restructure its venture capital unit in January.
According to a statement by Intel, the former president was replaced by Wendell Brooks, who was currently the head of mergers and acquisitions at the technology organization. It further added that this move was designed in a way so better investment decisions can be made by the firm.
Presently, the selling move by the company is still at an early stage and is focusing on attracting private equity firms who specialize in the purchase of portfolios that are popularly known as secondaries firms. Furthermore, this sale is likely to create a ripple affect not only for Intel but the entire industry.
Intel Capital was initiated in 1991 and ever since its inception it has invested as much as $11.6 billion in over 1,440 companies expanding through at least 57 countries across of a range of sectors. On 2015, the technology organization invested over $514 million in over 143 companies which its focus on a number of sectors including wearable devices as well as security software.
The Wall Street Journal believes that the company might not go forward with this sale as this move comes as a change in strategy by the current chief executive, Brain Krzanich who was appointed the position in 2013 when the former CEO Paul Otellini got retired. It is believed that under the leadership of Mr. Otellini, the Venture Capital unit flourished and was considered the most active venture investors in the world.
In addition to that many believe that times has change in the tech industry as PCs are being replaced with smartphone devices and cloud computing has become a destructive technology for data centers. This sale, during this transitional period, could allow Intel to use more resources in that growing and key technology areas.
Intel has declined to comment on this move and after the news broke Intel stock went up 51 cents to $31.76.
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