Intel Corp. (INTC) may be in for a heated proxy fight, and the market appears to anticipate positive change coming for the stalwart technology company.

Dan Loeb’s Third Point LLC on Dec. 29 launched a campaign at the supersized chipmaker demanding that it retain advisers and consider divestitures. As of close of trading on Thursday, Jan. 7, Intel’s shares were up $5.12 apiece, or roughly 11%, to $52.19 from their price of $47.07 before Loeb’s reveal.

The Deal identified Intel as an impending activist target in November after its shares dropped about 10% following third-quarter earnings, which featured weaker-than-expected results from the company’s data center segment. The Deal suggested that an activist could push Intel to reconsider its in-house chip manufacturing, or fabrication, efforts.

The chipmaker has had issues with recent generations of semiconductors, while many of its peers have adopted fabless models that outsource manufacturing. Moreover, other semiconductor companies have been targeted by insurgents with this objective in mind in recent months.

Intel now moves to The Deal’s “direct hits” list of companies subsequently targeted by an activist, after spending much of November and all of December on our Crosshairs list, which highlight’s the top 10 likely activist targets across several industries.

Intel, which in October announced plans to sell its Nand memory and storage business to SK Hynix Inc. for $9 billion, said Dec. 29 it looks “forward to engaging” with Third Point toward the goal of enhancing shareholder value.

In a letter to board chairman Omar Ishrak, Third Point argued that Intel is falling behind its rivals and should retain an investment adviser, evaluate strategic alternatives and consider a shift to outsource manufacturing of some products. Loeb cited some examples of U.S.-based rivals, such as Nvidia Corp. (NVDA) and Advanced Micro Devices Inc. (AMD), that employ Asian manufacturers to fabricate chips.

UBS analyst Timothy Arcuri in a Sunday note said Intel could consider establishing a manufacturing joint venture with a top foundry. Arcuri added that Intel has previously indicated it will provide more information about its outsourcing initiatives “around its January earnings call” on Jan. 21.

Third Point, meanwhile, also suggested it sought to have productive discussions with Intel’s board, adding that it was preserving “the option to submit nominees” for board election at Intel’s 2021 annual meeting. The deadline to nominate directors is Jan. 14 for an annual meeting expected in May.

Intel did not return a request for comment.

—Chris Nolter contributed to this article

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