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Intel Is Shifting Its Focus to Storage and Acquiring a Chipmaker That Could Boost Sales

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Intel said it plans to sell about $9 billion of its non-volatile memory chip business to a group led by Israeli chipmaker TowerJazz.

The Intel NAND Solutions Group makes products for long-term data storage, including solid-state memory chips used in PCs, smartphones and other devices. It previously generated about 13 percent of Intel’s total revenue.

San Jose, Calif.-based Intel said it will continue to sell memory chips that do not require energy to use, but it is shedding its portfolio of products intended to add power to portable devices, such as memory chips that attach to embedded microcontrollers, the tiny processors that plug into many of the devices in which they are typically found.

Intel said it would use the proceeds from the sale to invest more in its main business, its semiconductor manufacturing, at a time when the chipmaker is under pressure from rising demand for storage, smartphones and cloud computing.

The sale is expected to close in the first half of next year, subject to regulatory approvals and approval from TowerJazz’s shareholders.

“As our transformation to the data center and connected devices continues, we also have moved beyond flash to create memory that can be attached to an SD card or USB device for quick storage,” said Brian Krzanich, Intel’s chief executive. “As we address our semiconductor infrastructure business transition, we are maximizing value for Intel shareholders by taking an even more strategic approach to our NAND portfolio.”

The sale is a lucrative exit for Intel: The chipmaker’s NAND chips account for a small share of the $13 billion market for memory memory.

Although Intel will remain a leader in NAND, it did not say whether it would remain the largest supplier of that product to the mobile sector. It has seen its mobile shipments plummet to zero this year from more than 100 million in 2015. In the third quarter of 2016, Intel sold $700 million worth of NAND chips, down from more than $6 billion in the same period the previous year.

Its phone and tablet rivals such as Qualcomm and Samsung have made similar moves over the past few years. The technology, as it is known, has been heavily promoted by Amazon and Apple to create faster storage.

But both Intel and Intel rival Qualcomm have bet that chip technology that can compete with traditional drives such as hard drives and hard disks will be the next big thing in mobile.

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