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ATIC pumps another $2.8bn into GlobalFoundries

Transmuting oil into chips

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GlobalFoundries, the wafer-baking spin-out from Advanced Micro Devices, has received another cash boost as it ramps up production of new chip processes and expands beyond fabbing chips for companies other than AMD.

Parent company Advanced Technology Investment Company (ATIC) is pumping $2.8bn more into two of the outfit's eight fabs across the globe.

GlobalFoundries is still partially owned by AMD, but it's controlled by ATIC, an investment arm of the government of Abu Dhabi. The company had about $800m in capital spending last year (excluding acquisitions). Under the deal with AMD, ATIC said it would toss somewhere between $3.6bn and $6bn into the chip factories over five years while assuming $1.2bn in debts and paying AMD $1.4bn. That was the cost for ATIC to buy its way into the semiconductor biz.

AMD's former foundries are located in the Saxony city of Dresden, and they are now called Fab 1. AMD was building a new wafer baker in Saratoga, New York, when ATIC acquired the AMD chip operations. This is now called Fab 8, which comes with a $4.2bn price tag and which will come online in 2012 with 28 nanometer processes etching 300mm wafers. In September 2009, six months after acquiring AMD's chip making operations, ATIC spent $3.9bn to acquire Chartered Semiconductor, which operates factories in Singapore, now known as Fabs 2 through 7.

GlobalFoundries had about $2.5bn in revenues including the Chartered operations in 2009. The ATIC plan calls for GlobalFoundries to be able to deliver 1.6 million 300mm wafers and 2.2 million 200mm wafers across its eight fabs by 2012, and ATIC has invested $2.8bn in Fabs 1 and 8 in an effort to reach this goal.

ATIC says the investments in Dresden's Fab 1 will increase output to 80,000 300mm wafers per month once it is fully ramped, and the wafer capacity will be able to etch chips using 45 nanometer, 40 nanometer, and 28 nanometer processes. Fab 1 will also be gearing up to do the initial development for 22 nanometer processes, and all told, nearly 110,000 square feet of additional clean room space will be added to boost output to 80,000 wafers over the next two years. Construction is starting now on this new capacity, and it is expected to come online in 2011. The German government still has to rubberstamp the plant expansion.

GlobalFoundries needs to start planning for 22 nanometer and 20 nanometer production, and boosting the capacity of the Fab 8 plant in New York by 90,000 square feet (to 300,000 square feet of clean room and another 1 million square feet of supporting office space) will allow Fab 8 to eventually hit production of 60,000 wafers per month. ATIC said that initial chip manufacturing will begin in 2012, with volume production now targeted for early 2013.

ATIC has already said that it has invested in Singapore's Fab 7 so it could reach an output level of 50,000 wafers per month on 200mm wafers using older (and high-yield) 40 nanometer to 65 nanometer processes. That's a 50 per cent output boost compared to where Chartered was at when ATIC bought it and tucked it up inside GlobalFoundries.

The real question is when ATIC will put a foundry in Abu Dhabi. Perhaps ATIC is moving in that direction, but it looks like it will start with design operations first. ATIC said that it would create "an advanced technology cluster" in Abu Dhabi, right next to the international airport and spanning three square kilometers. ATIC stopped short of saying it would put a fab there, but this is obviously a goal. Oversight and regulation for an indigenous chip maker that is owned by the Emirate of Abu Dhabi will be quite friendly, one would assume. Not that the governments in New York and Saxony have not been downright friendly to AMD and now ATIC. ®

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