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Qualcomm made a takeover approach to chipmaker Intel in recent days, the Wall Street Journal reported on Friday, citing people familiar with the matter.
Intel’s shares closed up 3.3%, while Qualcomm was down 2.9%.
Intel has been attempting to turn its business around by focusing on its chip foundry unit and artificial intelligence processors, but its shares have plummeted in recent months as it cut jobs, suspended its dividend and faced a high-profile board member resignation.
A deal was far from certain, the WSJ report said, adding that even if Intel is receptive to an offer from Qualcomm, a deal of that size would attract antitrust scrutiny.
To get the deal done, Qualcomm could intend to sell assets or parts of Intel to other buyers, according to the report.
Intel declined to comment, while Qualcomm did not immediately respond to a Reuters request for comment.
Earlier this month, Reuters reported that Qualcomm explored the possibility of acquiring portions of Intel’s design business to boost the company’s product portfolio.
Qualcomm had examined acquiring different pieces of Intel, which is struggling to generate cash and looking to shed business units and sell off other assets, Reuters had reported.
Analysts and investors had said that Intel was likely to be removed from the Dow Jones Industrial Average index.
Intel’s shares have declined 57% this year, making it the worst performer on the index and leaving it with the lowest stock price on the price-weighted Dow.
Once dominant in the chip industry, Intel has been struggling to hold ground in the AI era and has lagged chip majors including Nvidia, AMD and Taiwan Semiconductor Manufacturing.
Intel’s foundry, or contract manufacturing business, signed up Amazon’s cloud services unit as a customer for making custom artificial intelligence chips, providing some respite to strained investors.