September 10, 2009 GlobalFoundries parent firm eyes expansion
An Abu Dhabi investment company with a heavy hand in GlobalFoundries New York computer chip factory is moving to expand its reach in the technology sector.
Officials with the Advanced Technology Investment Co. announced this week they intend to purchase Singapore-based Chartered Semiconductor Manufacturing and combine that firms operations with GlobalFoundries.
ATIC last year partnered with Advanced Micro Devices to create GlobalFoundries, the company now responsible for building and operating the $4.2 billion computer chip factory at the Luther Forest Technology Campus in Malta.
Officials with ATIC, a company wholly owned by the government of Abu Dhabi, said Chartereds customer relationships and GlobalFoundries expertise would help each company grow in the long term.
"Chartered and GlobalFoundries will be able to draw on each others strengths to enable the next generation of semiconductor innovation, utilizing the value of both companies and the intellectual capital of thousands of skilled employees," Ibrahim Ajami, ATICs CEO, said in a prepared statement.
GlobalFoundries spokesman Travis Bullard said Tuesday that plans in New York will continue as planned, and that finding additional customers for the facility could become easier because of the Chartered deal.
GlobalFoundries now has two customers AMD and STMicroelectronics.
"The ATIC acquisition bid for Chartered presents new opportunities for GlobalFoundries to accelerate third-party customer acquisition and establish broad, long-term customer engagements," Bullard said in an e-mail.
ATICs acquisition of Chartered still must go through regulatory review and be approved by Chartereds shareholders before it is finalized, but company officials said they hope to close the deal during the fourth quarter of this year.
Doug Grose, GlobalFoundries CEO, would become the CEO of the combined operation, according to a press release from ATIC and Chartered.
The development seemed to conjure hope for a rebound at the long-struggling AMD, the worlds second-largest computer chip maker.
A Barclays Capital analyst said Tuesday that ATICs planned purchase of Chartered "may be viewed as a strategic positive both for AMD and GlobalFoundries," according to the Dow Jones Newswire.
"ATIC has underlined its commitment to the foundry business and expanded (GlobalFoundries) potential customer list, while AMD may have a path toward lower losses and deconsolidating GlobalFoundries," the analyst, Tim Luke, said.
Shares of AMD rose 66 cents each, a gain of more than 14 percent, to close at $5.19 after heavy trading on Tuesday. The issue gained another penny a share on Wednesday to close at $5.20.
More than 73 million AMD shares changed hands on Tuesday in the wake of the announcement, with average daily trading volume for the stock at a little more than 22 million shares.
The stock has traded for as little as $1.62 and as much as $6.30 over the last 52 weeks.
The broader markets posted marginal gains over the same two days of trading.
