Crown Prince’s visit fuels rumour of GloFo sale

Crown Prince’s visit fuels rumour of GloFo sale

Business news |
By Peter Clarke

The Crown Prince toured Samsung’s chip-making plant and exhibition rooms in Hwaseong, Gyeonggi province on Tuesday February 26, the company said.

Globalfoundries is wholly owned by Mubadala, the sovereign wealth fund of Abu Dhabi, and the speculation is that Globalfoundries is being pitched to some combination of Samsung and SK Hynix because a sale to China’s Semiconductor Manufacturing International Corp. (Shanghai, China) would not be acceptable in the US.

With access to Chinese government funds SMIC could no doubt afford Globalfoundries and has a desire to accelerate its introduction of 14nm FinFET technology and catch up with the likes of Samsung and TSMC. At the same time is not clear Samsung or SK Hynix would find Globalfoundries and its multi-continental collection of fabs that attractive.

Globalfoundries was formed in 2009 when Mubadala bought out the manufacturing operation of processor chip company Advanced Micro Devices. Chartered Semiconductor of Singapore was added to Globalfoundries in 2010 and investment budgets of the order of $10 billion to $15 billion were much quoted in those early years. However, ambitious comments came to be replaced by the view that Globalfoundries would need to pay its way in the middle of the decade and the start of speculation about a sell off or even break-up of the company as Mubadala and Abu Dhabi seemed to lose their strategic interest in semiconductors.

Globalfoundries changed its technology roadmap significantly after it appointed Tom Caulfield as CEO in 2018 to replace Sanjay Jha. Caulfield took the decision to pull back from the expense of leading-edge 7nm FinFET development (see GloFo rethinks its future, drops 7nm FinFET).

Next: Trimming meat for market

The recent down-sizing of Globalfoundries and the sale of a Singaporean fab (see GloFo sells MEMS business, fab to Taiwan’s Vanguard) could be seen as necessary trimming to prepare the rump of the company for sale. However, there is still a concern that any potential buyer would want to cherry pick Globalfoundries’ most up-to-date wafer fab, in Albany, New York, and leave an older fab in Dresden, Germany out of the sale.

Globalfoundries does have history with Samsung. Back in 2014 Globalfoundries abandoned its 14nm process, which had been in development for at least two years, and instead licensed on a multi-year term, the 14LPE and 14LPP processes developed by Samsung. Also Globalfoundries and Samsung are both licensees of fully-depleted silicon-on-insulator (FDSOI) manufacturing process technology that was developed by STMicroelectronics following on from original research done by IBM Microelectronics.

The common interests in FinFET and FDSOI processes would make Globalfoundries and Samsung an easier fit but would also reduce the number of independent sources of chip manufacturing technology.

Related links and articles:

News articles:

GloFo sells MEMS business, fab to Taiwan’s Vanguard

Globalfoundries’ CEO steps down

GloFo rethinks its future, drops 7nm FinFET

Analysis: Outpaced by TSMC, GloFo cuts its cloth

GloFo sees success for its diversification strategy

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