Intel-Backed Altera Preps $2 Billion IPO as AI Money Wars Between OpenAI and Musk's SpaceX Escalate

A record year for AI money gets another entry

Silver Lake and Intel-backed chipmaker Altera is preparing to confidentially file for an initial public offering that could raise more than $2 billion, according to Reuters, with a listing possible before the end of this year. Silver Lake has tapped Barclays, Citi, JPMorgan and Morgan Stanley as underwriters, though the bank lineup hasn't been finalized, three people familiar with the discussions told Reuters.

The San Jose-based company makes field-programmable gate array chips used in data centers, telecom networks, aerospace, defense and AI systems. Intel bought Altera outright for about $16.7 billion in 2015. Last year Intel sold a 51% stake to Silver Lake for $4.46 billion, valuing the company at $8.75 billion, with Silver Lake committing roughly $3.3 billion in equity alongside Abu Dhabi's MGX. Intel kept the remaining 49%. CEO Raghib Hussain told Reuters in July the company was "preparing for an eventual public listing" as it chases growth in AI and robotics.

If it happens at the size reported, Altera's IPO would rank among the largest semiconductor listings since Arm Holdings raised nearly $5 billion in its 2023 debut. U.S. IPOs excluding SPACs raised $137 billion through the end of August. Anthropic could go public as soon as October with an expected raise around $100 billion, according to people familiar with the matter cited by Reuters, which would top SpaceX's $75 billion raise and could push 2026's total past the roughly $156 billion record set in 2021.

OpenAI cuts off SpaceX's new coding tool

While the IPO pipeline fills up, the AI industry's oldest grudge is flaring again. OpenAI has told Cursor, the coding assistant SpaceX acquired for $60 billion in a deal that closed August 14, that it will stop supplying its models to Cursor, with a proposed shutoff date set for November, according to CNBC. OpenAI said in its announcement that it "cannot be confident that SpaceX will use our technology within our terms of service, based on our experience with Elon Musk's companies violating contracts." That's OpenAI's characterization, not an adjudicated finding.

Cursor CEO Michael Truell said OpenAI's models account for roughly 5% of Cursor's user traffic and that Cursor was one of OpenAI's earliest users. "We've trusted their platform to be neutral infrastructure for our business," Truell wrote on X. Musk fired back on X, calling Altman "Scam Altman" and Brockman "Greg Stockman," and repeating his long-standing claim that OpenAI "stole an open source nonprofit." Musk made that same accusation in court after suing Altman, Brockman and OpenAI in 2024. He lost that case earlier this year and has said he will appeal, according to Breitbart's review of the litigation history.

Anthropic, notably, isn't following OpenAI's lead. It cut off the coding tool Windsurf from its Claude models last year, but it's now partnering with SpaceX and renting compute capacity from Musk's company, and plans to keep supplying Cursor with Claude models under SpaceX ownership. Cursor's acquisition is the latest in a run of deals tied to Musk: SpaceX bought both X and xAI in February and went public itself in June. OpenAI, for its part, is reportedly preparing its own public offering.

Wyoming wants in on the buildout

The fight over who gets to run AI models is one battle. The fight over where the physical data centers get built is another, and Wyoming thinks it can win it. Jared Walczak, a senior fellow at the Tax Foundation, told Fox News Digital that Wyoming's land, affordable energy, lack of natural disaster risk and high-capacity fiber along its interstate corridors give it an edge as other states get skittish. "If more states start imposing discriminatory taxes just on data centers, then places like Wyoming, at least as long as they don't do likewise, can become even more attractive," Walczak said.

This is not merely hypothetical. Cheyenne officials rejected a proposed one-year moratorium on new data centers in May after residents raised real questions about electricity rates and water use, and Wyoming lawmakers have floated reclassifying data centers as industrial property to raise their tax assessment rate. Those concerns over strained grids and local water supplies are legitimate and shared by communities in Virginia and elsewhere that have hosted data centers for years. Wyoming hasn't dismissed them. It's still debating tax treatment even as it courts the investment.

AI has become the biggest capital event in a generation. From Wall Street underwriters lining up for Altera's filing, to Musk and Altman fighting over who controls the tools developers use, to state legislatures deciding whether cheap land and light regulation are worth the strain on local power grids. None of these fights are settled. Altera's filing and size could still change, per Reuters. OpenAI's November cutoff date for Cursor hasn't taken effect yet. And Wyoming's tax reclassification fight is still working its way through the legislature.