GlobalFoundries integrates with Chartered, expected to take No. 2 status in foundry space
The move is viewed as a positive for the two combining companies, as well as AMD.
By Suzanne Deffree, Managing Editor, News -- EDN, January 13, 2010
As of today, GlobalFoundries has officially integrated operations with Chartered Semiconductor Manufacturing and started functioning as one company under the GlobalFoundries brand.
The integrated GlobalFoundries is hailing itself as the first full-service semiconductor foundry with a global manufacturing and technology footprint across Asia, Europe, and the United States. The combined company employs some 10,000 people at its Silicon Valley headquarters; manufacturing operations in Singapore, Dresden, and Saratoga County, New York; and customer support centers in Singapore, China, Taiwan, Japan, the United States, Germany, and the United Kingdom.
With 2009 revenues for GlobalFoundries and Chartered in excess of $2 billion and more than 150 pooled customers, the company said it has plans to deepen existing relationships and to aggressively pursue new customers.
“Chartered and GlobalFoundries combined would take the No. 2 status in the foundry space with the second largest market share of around 26% only after TSMC, which has around 29% share based on planned 300-mm capacity,” Tim Luke, a semiconductor market analyst at Barclays Capital, said in a research note this morning. “We highlight that Chartered has a broad customer base including marquee names such as Broadcom, Qualcomm, Marvell, Microsoft (for its X-Box 360 game console), and IBM providing the combined entity a customer list of over 150 customers.”
Just last week, GlobalFoundries announced it would work with Qualcomm on 45-nm low power and 28-nm low power technologies with an intended collaboration on future advanced process nodes. In October 2009, the manufacturing spinoff of AMD announced a partnership with ARM on 28-nm HKMG for the Cortex-A9. And prior to that, GlobalFoundries made headlines when it announced STMicroelectronics as a 40-nm low-power bulk silicon customer.
Today’s integration had been widely expected since the closure of the Chartered acquisition on December 18, 2009, by Advanced Technology Investment Company (ATIC). With investment from ATIC, AMD in October 2008 officially announced plans to spin off its manufacturing operations and form GlobalFoundries.
Broken out, the new GlobalFoundries currently has five 200-mm fabs and one 300-mm fab in Singapore, as well as one 300-mm fab complex in Dresden, Germany. The company’s capacity build-out plan includes expansion of Fab 1 in Dresden and Fab 7 in Singapore, as well as construction of a long-time-coming 300-mm facility in New York, for which plans began while GlobalFoundries was still the manufacturing operations of AMD. GlobalFoundries reported that the New York facility is on track to begin ramping initial production in 2012.
All in all, the combined GlobalFoundries’ capacity is expected to expand to 1.6 million 300-mm wafers annually by 2014. This will be supplemented by 2.2 million 200-mm wafers annually, the integrated GlobalFoundries said.
“Until now, the world’s largest fabless, fablite, and integrated manufacturers have had no real alternative for an end-to-end manufacturing partner,” said Chia Song Hwee, chief operating officer of GlobalFoundries, in a company statement. “This new company has an incredible opportunity in front of us to not just offer an alternative, but become the preferred supplier for many of the world’s top chip design companies. With advanced technology leadership, an aggressive capacity roadmap, and a robust set of mainstream technologies and foundry services we are well equipped to compete and win against any other foundry in the industry.”
Luke further noted in his report that today’s integration is a positive for AMD, which still owns a stake in GlobalFoundries. AMD has stated plans to reduce its ownership of GlobalFoundries, which would in turn help the company reduce expenses and strain on investment dollars.
“We see today's announcement as a net positive for AMD and another major milestone in the deconsolidation process,” he said. “We highlight that from AMD's perspective, GlobalFoundries is a variable interest entity where AMD is deemed to be the primary beneficiary with 83.3% of GlobalFoundries gains/losses flowing through to AMD. While AMD product's current ownership in GlobalFoundries on a fully diluted basis as of the end of Q3 was 32%, we believe that AMD's ownership in GlobalFoundries is likely to decline as the combination of GlobalFoundries and Chartered is likely to dilute AMD's ownership. As GlobalFoundries secures significantly third party customers through the merger with Chartered, we expect this to translate in lower loss levels for AMD and ultimately a deconsolidation event for AMD.”
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Nick Matyas - 2010-14-1 01:31:00 PST -
Can we get some idea about the effect on employees? Will the consolidated GF+CSM
1. Reduce the number of employees?
2. Retain all employees?
3. Retain and add employees?
PJD - 2010-13-1 11:50:00 PST
