The government of Abu Dhabi has taken full ownership of GlobalFoundries, AMD’s former chipmaking facilities, with AMD giving up its minority stake in the business it spun off back in 2009. The takeover means GlobalFoundries is theoretically now free to pursue a business as a full independent manufacturer for microprocessors and other chips for companies that do not own their own manufacturing facilities (or “fabs”). However, for the time being at least, AMD will remain a key GlobalFoundries customer.
“Today marks the start of a new era for GlobalFoundries as it becomes a truly independent foundry,” said CEO Ajit Manocha, in a statement. “GlobalFoundries has a clear vision to be the leading semiconductor foundry partner to AMD and one of the world’s top technology companies. We continue to execute on our strategy to propel ATIC’s long-term investment philosophy into true value creation for our shareholder and customers.”
Although GlobalFoundries spun off from AMD, AMD retained less than 10 percent of the company. Under a the revised wafer supply deal with AMD, GlobalFoundries has agreed to waive a requirement that AMD buy wafers based on its new 28nm production process for a specified period of time. Apparently in exchange, AMD is paying GlobalFoundries some $425 million — AMD says getting out of GlobalFoundries will cost it over $700 million in the first quarter of 2012 to cover that payment and other costs.
GlobalFoundries’ primary manufacturing facilities are located in Singapore and Dresden, Germany. The company is also launching a new fab in upstate New York, which is expected to be online by the end of 2013.
AMD spun off its chipmaking facilities into a separate business in 2009 to cut its costs; the primary investor was Advanced Technology Investment Co. (ATIC), a company owned by the government of oil-rich Abu Dhabi to fuel development of the country’s technology industry. ATIC also acquired Singapore’s Chartered Semiconductor Manufacturing Ltd. in 2008 for $1.8 billion, which it has since combined with GlobalFoundries operations.