Nvidia bets US$5 billion on Intel’s comeback

A Nvidia office building is shown in Santa Clara, Calif. (Jeff Chiu/AP Photo)

Nvidia has purchased Intel shares worth $5 billion, the American semiconductor firm said in a filing on Monday, carrying out a transaction announced in September.

The leading AI chip designer said in September it would pay US$23.28 per share for Intel common stock, in a deal that is seen as a major financial lifeline for the chipmaker after years of missteps and capital intensive production capacity expansions drained its finances.

The world’s most valuable firm has bought over 214.7 million Intel shares at the price set out in the September agreement, in a private placement, according to Monday’s filing.

U.S. antitrust agencies had cleared Nvidia’s investment in Intel, according to a notice posted by the U.S. Federal Trade Commission earlier in December.

Nvidia shares were down 1.3 per cent in premarket trading while Intel stock was little changed.

(Reporting by Arsheeya Bajwa in Bengaluru; Editing by Anil D’Silva)