Reliance Industries Eyeing Acquisition of Israel's Tower Semiconductor

Mukesh Ambani-led Reliance Industries is reportedly considering the acquisition of Tower Semiconductor, an Israel-based semiconductor company. However, the ongoing Israel-Hamas conflict may potentially delay these plans. A company spokesperson denied these reports, stating that there is no truth in the acquisition talks.

If the acquisition were to proceed, it could mark Reliance's foray into the chip ecosystem. In the past, there were rumors of Reliance's interest in acquiring a stake in the International Semiconductor Consortium (ISMC), a semiconductor wafer fab applicant, although no further developments occurred.

This opportunity for Reliance comes after Intel recently abandoned its $5.4 billion acquisition of Tower Semiconductor due to regulatory hurdles. Experts believe that this development provides Reliance with a potential opportunity to acquire Tower Semiconductor or some stake in the company.

Tower Semiconductor is a leading foundry specializing in high-value analog semiconductor solutions, serving over 300 customers globally in various sectors, including automotive, medical, industrial, consumer, aerospace, and defense. It ranked seventh in global foundry revenue with $356 million in TrendForce Q1-Q3 data, and its annual revenue is expected to exceed $1 billion.

Tower Semiconductor has expressed a willingness to support India in developing its semiconductor ecosystem. In the past, it was part of a consortium led by the Jaypee Group and offered to be a technology partner, and more recently, it discussed a potential partnership with ISMC under India's semiconductor incentive scheme. This initiative aligns with India's efforts to boost domestic semiconductor manufacturing.

Union Minister of State, Ministry of Electronics & IT, Rajeev Chandrasekhar, recently held a meeting with Russell C. Ellwanger, CEO of Tower Semiconductor, in India, along with Israel's Ambassador to India, Naor Gilon, to explore possibilities for India-Tower collaboration in the semiconductor sector.

Reliance's interest in Tower Semiconductor aligns with the growing interest of major Indian business houses, such as Tata, Vedanta, and the Hiranandani Group, in entering the chip manufacturing industry. These moves signify a broader trend of Indian conglomerates venturing into chip manufacturing, which could potentially future-proof their telecom and electronics businesses.