Intel CEO Tan under scrutiny due to conflict of interest

"One of the most notable cases concerns AI startup Rivos. Tan (photo) was both chairman of the board and a shareholder there, while he convinced Intel to engage in intensive talks with the company. Attempts to complete an acquisition initially failed because Intel's advisory board identified him as a party with a direct interest. The situation changed when Meta showed interest and made an offer. The ensuing bidding war drove Rivos' valuation to about double previous internal estimates."

"A similar dynamic played out in the case of SambaNova, an AI hardware company where Tan had previously become chairman of the board. SambaNova was struggling with declining revenues and an increasing need for new financing. Although the company struggled to close the next round of investment, Intel was asked to consider a strategic scenario. Sources report that a non-binding letter of intent for a potential transaction is now in place, though both parties are keeping their cards close to the vest."

"Within Intel, Tan's dual role led to new internal policies. He must now recuse himself from decisions in which he may have a personal interest. In practice, responsibility for such investment decisions has shifted to CFO David Zinsner, who reports directly to Tan. Critics note that this only partially strengthens independence, although Intel emphasizes that it strictly monitors transactions that may involve conflicts"

Several transactions in which Intel CEO Lip-Bu Tan held personal financial interests coincided with Intel strategic outreach to those firms, prompting conflict concerns. Tan acted as chairman and shareholder at Rivos and urged Intel into intensive acquisition talks; an advisory board initially flagged his direct interest, but a later Meta bid doubled Rivos’ valuation. Tan also became chairman at SambaNova as the company faced revenue declines and financing needs, leading to a non-binding letter of intent for a potential transaction. Intel implemented recusal policies and delegated related investment decisions to CFO David Zinsner while critics question the depth of independence.

Read at Techzine Global