Cash-Less Intel

The Intel-Altera deal is said to be costing $16.7 billion in cash.

Intel doesn’t have $16.7 billion cash, it only has $14.6 billion cash

So Intel will have to borrow at least $2 billion to pay for Altera. It will most likely borrow more  and retain some cash.

But, however much it borrows, Intel now enters negative cash territory.

Next time Intel builds a fab, T a cost currently running at $8-10 billion, it will probably have to borrow the money to do it, which is an unusual position for Intel to be in, to say the least.

Of course it may be preparing to go fabless!

The modern enthusiasm for debt probably makes Intel’s finance people relaxed about having $15 billion plus of net debt.

But if interest rates rise, the company will be well and truly shafted.


Comments

4 comments

  1. Well I think we both read it it right, DontAgree

  2. Altera debt 1.5B, cash 2.4B (if I read the Yahoo balance sheet correctly).

  3. Cash of $2.5bn and long-term debt of $1.5bn, Dick

  4. How much cash does Altera have?

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