May 01, 2009 GlobalFoundries puts its chips on the table Analysts, journalists get a tour of campus as it is, as it will be
By LARRY RULISON, Business writer
First published in print: Friday, May 1, 2009
MALTA ﾗ Changes are coming quickly to Luther Forest Technology Campus.
Officials from GlobalFoundries Inc., the company planning a $4.2 billion computer chip factory here, told technology writers and analysts from around the world Thursday they are close to buying the 222 acres for the project and starting ground work.
"We're about to start clearing the site," said Terry Caudell, project manager for what will be known as Fab 2.
GlobalFoundries and Luther Forest Technology Campus Economic Development Corp., which owns 1,414 acres that straddle the towns of Malta and Stillwater, still must finalize their transaction, estimated to cost between $7 million and $8 million.
Although the two parties believe the closing could occur any day now ﾗ they have been saying that for two weeks ﾗ it's likely to wrap up by next week. The complexity of the deal, especially the deed and other documentation, is why the closing was not done as of Thursday.
Once completed, GlobalFoundries will send its official commitment letter to the state of New York, and that will make the company eligible for $650 million in cash for the 1.3 million-square-foot building and costs for research and development.
Then GlobalFoundries will name the general contractor for the project, which is expected to be M+W Zander. Zander, in turn, will award the first contract of the project for initial site clearing, which involves removing trees and roots and moving dirt and sand.
"It will happen pretty fast," said GlobalFoundries spokesman Travis Bullard.
GlobalFoundries invited journalists and analysts who cover the computer chip industry to Malta to meet with company executives and learn about plans for Fab 2, which is expected to reach full-scale production by 2012, supplementing existing manufacturing in Dresden, Germany.
Some came from as far away as London and Israel. GlobalFoundries Chief Executive Officer Doug Grose was in attendance, along with other top executives.
The event ended with a bus tour of Luther Forest, including the site where Fab 2 will be built. They also toured Albany NanoTech, where GlobalFoundries does chip research as part of an alliance with IBM Corp.
GlobalFoundries was created two months ago as a spinoff of Advanced Micro Devices Inc. of Sunnyvale, Calif., which first announced plans for the project in June 2006. AMD has since decided to move to a "fabless" manufacturing model, in which it outsources all of its chip production.
AMD maintained a significant stake, though, in GlobalFoundries in a joint venture with Advanced Technology Investment Co., an investment fund owned by the Emirate of Abu Dhabi.
AMD is GlobalFoundries' first customer, but new clients are being aggressively pursued, officials said. The Fab 2 site actually has space for up to three factories, or modules, although the company has only committed to one so far.
"We think this is a well-designed campus, and it will serve us well into the future," Caudell said.
