Intel (INTC, Financials) agreed to sell a 51% stake in its Altera business to private equity firm Silver Lake, valuing the unit at $8.75 billion, the companies announced Wednesday. The transaction is expected to close in the second half of 2025, subject to regulatory approvals and other customary closing conditions.

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The deal will make Altera the largest independent provider of field-programmable gate array semiconductor solutions, with Intel retaining a 49% interest. The company said the divestiture aligns with its strategy to streamline operations and concentrate on its core businesses while retaining upside exposure through its minority stake.

Intel also announced a leadership change at Altera, appointing Raghib Hussain as chief executive officer, effective May 5. Hussain, formerly president of products and technologies at Marvell Technology (MRVL, Financials), previously co-founded Cavium and held engineering roles at Cisco (CSCO, Financials) and Cadence Design Systems (CDNS, Financials).

Intel said it expects to deconsolidate Altera's financials following the transaction. In fiscal 2024, Altera posted $1.54 billion in revenue, with a GAAP operating loss of $615 million. On a non-GAAP basis, Altera reported operating income of $35 million.

Silver Lake's chairman Kenneth Hao called the investment a once-in-a-generation opportunity and said the firm would support Altera's growth in AI-driven areas such as edge computing and robotics. Intel CEO Lip-Bu Tan said the firm was focused on cutting expenses, sharpening strategic priorities, and strengthening the balance sheet.

Intel acquired Altera in 2015 for $16.7 billion. The partial sale marks a renewed effort by Intel to restructure under new leadership, as it contends with competition and shifts in semiconductor demand.