Intel Is in Talks to Buy GlobalFoundries for About $30 Billion

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Intel Corp.

INTC -1.26%

is exploring a deal to buy GlobalFoundries Inc., according to people familiar with the matter, in a move that would turbocharge the semiconductor giant’s plans to make more chips for other tech companies and rate as its largest acquisition ever.

A deal could value GlobalFoundries at around $30 billion, the people said. It isn’t guaranteed one will come together, and GlobalFoundries could proceed with a planned initial public offering. GlobalFoundries is owned by Mubadala Investment Co., an investment arm of the Abu Dhabi government, but headquartered in the U.S.

Any talks don’t appear to include GlobalFoundries itself as a spokeswoman for the company said it isn’t in discussions with Intel.

Intel’s new Chief Executive, Pat Gelsinger, in March said the company would launch a major push to become a chip manufacturer for others, a market dominated by

Taiwan Semiconductor Manufacturing Co.

TSM -5.51%

Intel, with a market value of around $225 billion, this year pledged more than $20 billion in investments to expand chip-making facilities in the U.S. and Mr. Gelsinger has said more commitments domestically and abroad are in the works.

GlobalFoundries is one of the largest specialist chip-production companies. It was created when Intel rival Advanced Micro Devices Inc. in 2008 decided to spin off its chip-production operations. AMD remains a big customer for GlobalFoundries—agreeing to a multiyear, roughly $1.6 billion chip-component supply deal this year—and that could complicate a takeover by Intel. GlobalFoundries is relocating its corporate headquarters to Malta, N.Y. from Santa Clara, Calif.

GlobalFoundries has about 7% of the foundry market share by revenue, according to Taiwan-based research firm TrendForce. Some of the largest chip companies, including

Qualcomm Inc.

and

Nvidia Corp.

, rely on third-party producers to make their products, preferring to focus on design and without the hassle of running their own factories. Nvidia last year overtook Intel as America’s biggest semiconductor company by value.

Like Intel and TSMC, GlobalFoundries is expanding its manufacturing footprint amid a global shortage of semiconductors. GlobalFoundries last month said it broke ground on a new chip-production facility, called a fab, in Singapore, investing more than $4 billion in the site.

Write to Cara Lombardo at cara.lombardo@wsj.com and Dana Cimilluca at dana.cimilluca@wsj.com

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