Microchip giant Intel (INTC) is spinning off its venture capital unit as it restructures its business.
Specifically, the company plans to spin-off its venture capital arm called “Intel Capital” into a standalone fund will allow it to raise money from outside investors.
Intel Capital currently has $5 billion U.S. of assets under management. Until now, the venture capital unit had been funded entirely by Intel.
The move to spin-off Intel Capital comes as the company restructures amid an ongoing decline in its finances and share price.
Intel’s stock has declined nearly 60% in the last 12 months, its worst annual performance since the company went public in 1971.
Intel has struggled with a costly move to not only design microchips and processors but also manufacture them through a new foundry business.
Steady financial losses have pushed the company to cut costs. In recent months, Intel has sold or wound down smaller divisions and laid off staff.
Intel also recently fired CEO Pat Gelsinger after four difficult years. He has been replaced by two interim co-CEOs, David Zinzner and Michelle Holthaus.
Regarding Intel Capital, the company said it plans to make the venture arm fully independent in the second half of this year.
Intel Capital was established in 1991 and was unique at the time as a venture arm of a large corporation.
However, the venture capital model has since been replicated by other tech giants such as Alphabet (GOOGL) and Microsoft (MSFT).
The stock of Intel is currently trading at $19.20 U.S. per share.
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