March 23, 2009 Malta fab gets OK Company board commits to the $4.2B computer chip factory, a move needed for a $1.2B state incentive package
By LARRY RULISON, Business writer
First published in print: Saturday, March 21, 2009
MALTA ﾗ In a largely procedural yet important step, the board of directors of GlobalFoundries Inc. has approved moving forward with construction of its $4.2 billion computer chip factory planned for Malta.
The company, a spin-off of Advanced Micro Devices Inc., has already verbally committed to the project, first announced back in 2006 by Gov. George Pataki.
But in order to be eligible for the state's $1.2 billion incentive package ﾗ including $650 million in cash ﾗ GlobalFoundries has to send an official commitment letter to the state by July 31.
On Wednesday, the GlobalFoundries board, headed by former AMD chief executive Hector Ruiz, voted to commit to the project. The letter will be sent to the Empire State Development Corp. before the deadline, said GlobalFoundries spokesman Travis Bullard.
"That's good," he added of the board approval. "So we've got that under our belt."
Under the terms of the deal, New York state will raise the cash by issuing bonds.
"We will establish a timeline once we receive the letter," ESDC spokesman Warner Johnston said.
GlobalFoundries is ready to start clearing land at the Luther Forest Technology Campus where it plans to build the factory, known as Fab 2. The company is close to completing negotiations with Luther Forest for a 222-acre site, and has received approval to begin clearing land from the towns of Malta and Stillwater. The 1,414-acre tech park has land in both towns.
Bullard said that, depending on the date of the sale closing, initial site clearing is expected to start in early April.
The company also is seeking permits for construction of temporary structures, such as a concrete plant, and permanent structures such as the clean room where computer chips will be made.
Once those are obtained, GlobalFoundries is expecting to start construction this summer, with full-scale manufacturing starting in 2012.
Bullard also said the first bid package for the project has been sent out to 10 subcontractors by M+W Zander, the likely general contractor for Fab 2. A total of seven firms responded with bids for the $19 million site-clearing project. Bullard did not name the firms.
"We're in the process of collecting those bids," he said.
And there will be plenty of additional work. Bullard said GlobalFoundries has between 130 and 140 bid packages that will be used for construction of the site and the building, expected to cost $800 million before the expensive manufacturing equipment is installed.
"It's just one of the smaller packages," Bullard said of the site clearing work.
Larry Rulison can be reached at 454-5504 or by e-mail at lrulison@timesunion.com.
Fab facts
GlobalFoundries is building a $4.2 billion computer chip factory at the Luther Forest Technology Campus in Malta. Here are some highlights:
Size: 1.2 million square feet
Jobs: 1,465, $88 million payroll
Construction jobs: 1,600, $102 million payroll
Building shell completed: 2010
Fab completed (including tool installation): July 2011
