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Cloudera said it bought back all of Intel’s stake in the software company for $ 314 million, which would likely have caused the chip giant a substantial paper loss on its investment.
Alexander Koerner / Getty Images
Wednesday late
Cloudera
said he had bought back the entire stake
Intel
bought the software company for $ 314 million, likely reserving a substantial paper loss for the chip giant on its investment.
Cloudera stock (ticker: CLDR) rose 1.1% in the extended session, adding to a close of $ 15 with a gain of 2.5% in the regular session. Shares of Intel (INTC) rose 0.1% after hours, after ending the regular session up 0.9% to $ 46.57.
Intel invested $ 742 million several years ago, in part because the chip giant wanted to have a say in the direction of big data software, such as products made by Cloudera. In Wednesday’s announcement, Cloudera said the buyout would not affect existing business partnerships with Intel, and that it was paying $ 12.05 each for around 26 million shares.
The investment appears to have generated a loss of around $ 400 million for Intel, but it’s not clear that Intel bought its stake in the hopes of a windfall. When Intel initially bought the stock, it paid double for Cloudera shares than what another group of investors had paid a few weeks earlier. At the time, then under Brian Kzranich’s leadership, Intel was apparently aiming to beef up potential buyers of Cloudera, scaring them with a valuation of $ 4.1 billion.
Intel paid $ 30.92 for 11.99 million shares, which cost the company about 5% of its cash and short-term investments at the time. The price was more than double the $ 15 share price that Cloudera would eventually go public with in 2017.
Intel did not immediately respond to a request for comment, but it is possible that the decision to unwind Cloudera’s stake was part of a plan to get rid of the company’s non-core assets and acquire small businesses that will strengthen its efforts in areas such as the artificial. intelligence.
Earlier this year, Intel sold its memory business to South Korea
SK Hynix
for $ 9 billion. In late 2019, Intel bought Habana Labs, an Israel-based AI chip maker for $ 2 billion. And in July 2019, Intel announced that it was selling its smartphone modem business to
Apple
(AAPL). Apple has reportedly started building its own cellular modems for its future iPhones, according to a December report.
Write to Max A. Cherney at [email protected]
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