With little time to get regulatory approval, Intel Corp. is expected to cancel its plan to buy Tower Semiconductor Ltd. for $5.4 billion, according to people familiar with the matter.。

In the past two years, with the gradual decline in market share, as a chip industry giant, Intel began to invest frantically in expansion to regain lost market share。Intel, under CEO Pat Gelsinger, has been building plants everywhere to better compete with rivals AMD, NVIDIA and Samsung.。

In June, Intel said it would invest up to $4.6 billion to build a new semiconductor assembly and testing facility near Wroclaw, Poland, as part of a multibillion-dollar European investment to build chip capacity.。

In fact, last year, the U.S. chipmaker announced plans to build a large chip complex in Germany and factories in Ireland and France to seek to benefit from the European Commission's relaxation of financing rules and subsidies, as the EU hopes to reduce its dependence on U.S. and Asian supplies.。

In addition to Poland, Intel's expansion plans in another European country have also made new progress。Intel will receive nearly $11 billion in subsidies from the German government to build a chip manufacturing plant in eastern Germany.。The company delayed plans to build a plant in Magdeburg late last year due to the economic downturn, when the government gave 6.8 billion euros ($7.2 billion) in aid and has been seeking more funding support.。

As part of the negotiations, the German government is willing to provide more state subsidies to the U.S. company, but only if Intel significantly increases its overall investment in the plant, according to people familiar with the matter.。The source added that Germany is currently willing to set aside about 10 billion euros.。The talks are likely to continue through the weekend, with an official announcement expected as early as Monday.。

Intel initially estimated that the project in Germany would cost 17 billion euros, but now it is expected to cost 30 billion euros.。As with most projects that will receive government funding through the EU's Chip Act, Intel expects about 40 percent of its projects to receive subsidies, according to people familiar with the matter.。

Notably, Intel also plans to invest $100 billion to build what could be the world's largest chip manufacturing plant in Ohio.。

Of course, the acquisition of Tower Semiconductor is also part of Intel CEO Pat Gelsinger's plan to enter faster-growing areas of the semiconductor industry.。Tower has relatively little influence in this area, and the company produces chips for customers on a contract basis, but has the expertise and customers that Intel lacks.。

About Tower Semiconductor。A semiconductor company based in Israel, the company's expertise in radio frequency (RF), power supplies, silicon germanium (SiGe), industrial sensors and other specialized technologies, as well as its extensive IP, electronic design automation (EDA) partnerships and mature foundry layout, will provide Intel and Tower Semiconductor's global customers with extensive coverage.。

Tower Semiconductor also serves high-growth markets such as mobile, automotive, and power, operating foundry businesses across regions, with facilities in the U.S. and Asia, serving fabless companies and IDM, and providing more than 2 million initial wafer capacity per year, including growth opportunities in Texas, Israel, Italy, and Japan。

For the cancellation of the acquisition plan, in fact, most investors are not surprised。Because stocks across the semiconductor industry have soared this year, but Tower's stock is still down 22% year-to-date, closing at 33 on Tuesday.$78, well below Intel's proposed $53 per share。

Sanford C.Bernstein analyst Stacy Rasgon said the collapse of the deal was not a surprise given the fall in Tower's share price, but would be a setback for Intel.。

Following media coverage, he wrote in a research note: "A failed deal does seem a bit disappointing for the prospects of Intel foundry.。"。"In general, even with Tower, Intel's casting work has never been easy, but without Tower, it may be more challenging now。"

In terms of revenue, Tower is a fraction of the size of Intel and TSMC, but it makes parts for big customers like Broadcom Inc.。Intel's plan is to merge the factory with Tower and leverage its customer list。Although the chips made by Tower do not require the most advanced production technology required by Intel or Nvidia processors, they serve growing markets such as electric vehicles。