A public sale of stock in the company is expected to take place over the following two to three years, according to chipmaker Intel, which aims to operate its programmable chip unit as a standalone business beginning in January.

Following the announcement, Intel stock increased by more than 2%.

When Intel acquired Altera for $16.7 billion in 2015, it also acquired the company. Programmable chips are used in anything from data encryption to 5G wireless telecommunications equipment. They sit in between Intel’s general purpose CPUs and chips that are designed for a single activity.

The new entity, which will continue to use Intel’s facility to create its chips, will be run by Sandra Rivera, an experienced Intel employee, according to Intel.

Rivera presently manages Intel’s data centre and artificial intelligence chip division, which competes with Nvidia and Advanced Micro Devices. Intel announced that it has begun “an extensive internal and external search” to replace Rivera.

Rivera revealed the company is increasingly employing Intel’s factories rather than the Taiwanese ones where its chips were formerly produced during a conference call with investors. Fighter planes and other military applications use programmable electronics.

“We see enormous customer interest in a more secure, resilient supply chain in North America, and you could just imagine the industrial customers, the aerospace and defense base customers,” Rivera said. “We’re setting this up to really have a unique advantage by leveraging Intel.”

The agreement comes after Intel’s earlier decisions to break ways with its Mobileye self-driving car chip unit and sell its memory chip unit to SK Hynix. Both initiatives sought to streamline Intel’s operations and raise money for Chief Executive Pat Gelsinger’s plan to bring the business around by resurrecting its manufacturing division, which had lagged behind rivals like Taiwan Semiconductor Manufacturing Co.

“This seems like an overdue, smart, and effective move to potentially create more value for investors and allow Intel to focus on core competencies while raising funds for its turnaround attempt,” said Michael Ashley Schulman, chief investment officer at Running Point Capital Advisors.

(Adapted from CNBC.com)