Intel is raising $20 billion through a new stock offering, giving the US chipmaker a major injection of fresh capital as it continues to invest in its business.
Intel said Monday it priced 210,526,315 shares of common stock at $95 per share. The offering was increased from the previously announced $15 billion.
The company expects to receive approximately $19.7 billion in net proceeds, assuming the underwriters do not exercise an option to purchase additional shares. The amount reflects deductions for underwriting discounts and commissions as well as estimated offering expenses. The underwriters have a 30-day option to purchase up to 31,578,947 additional Intel shares at the $95 offering price, less underwriting discounts.
The offering is expected to close on Aug. 12, subject to customary closing conditions.
Intel said it plans to use the proceeds for general corporate purposes, which may include capital expenditures and working capital. The company did not provide a detailed breakdown of how the money will be allocated. The new funding gives Intel additional cash to support its operations and investment plans at a time when semiconductor companies are committing billions of dollars to advanced manufacturing and computing infrastructure.
The stock sale will increase the number of Intel shares in circulation, meaning existing shareholders will own a smaller percentage of the company once the new shares are issued. That dilution could increase if the underwriters exercise their option to purchase the additional 31.58 million shares.
J.P. Morgan, Goldman Sachs & Co. LLC, Morgan Stanley and Citigroup are acting as joint book-running managers for the offering.
Barclays, BofA Securities, BNP Paribas, Credit Agricole CIB, Deutsche Bank Securities, Mizuho, RBC Capital Markets, TD Securities, Wells Fargo Securities and Cantor are among the other banks acting as book-running managers. Intel has filed a registration statement on Form S-3 with the US Securities and Exchange Commission for the offering.
Intel, which trades on the Nasdaq under the ticker INTC, designs and manufactures semiconductors used in computers, data centers and other technology products. The $20 billion fundraising gives the company additional financial resources for capital spending, working capital and other corporate purposes.