Chartered Semiconductor Manufacturing Ltd (特許), the Singapore-based chipmaker being bought by the Abu Dhabi government, will double the capacity of its most advanced facility by the end of 2011 as part of plans to become the world’s second-biggest foundry.
Advanced Technology Investment Co (ATIC), owned by the Abu Dhabi government, is paying Chartered shareholders US$2.5 billion and plans to merge the Singapore company with Globalfoundries Inc, a chipmaker ATIC created with Advanced Micro Devices Inc last year. The deal, approved by Chartered shareholders yesterday, may allow the combined entity to overtake Taiwan’s United Microelectronics Corp (UMC, 聯電), the world’s second-biggest maker of customized chips.
“With the combined strength of both entities, we are in a much better position to compete,” Chartered chief executive officer Chia Song Hwee (謝松輝) said in Singapore yesterday.
Chartered, the world’s third-biggest maker of customized chips, is doubling the annual capacity of its “Fab 7” plant — which makes semiconductors using 65 nanometer or advanced technology — from 25,000 wafers to 50,000 wafers by 2011, Chia said.
The company has earmarked US$500 million in capital spending for this year, Chia said. By year’s end, Fab 7’s capacity will be about 29,000 wafers, he said.
The purchase of Chartered will add 11.3 percent of the worldwide custom-chip market to Globalfoundries, according to iSuppli data, which doesn’t rank Globalfoundries. Hsinchu-based UMC, with 14.1 percent market share in the first quarter, trails Taiwan Semiconductor Manufacturing Co (台積電), which commanded 49 percent of the market, according to a June 8 iSuppli report.
“We are ready to get down to business and build the combined entities together,” Ibrahim Ajami, ATIC chief executive officer, said in Singapore yesterday. “We are expanding our capacity in Singapore. We are continuing our expansion in Dresden, Germany and we just recently broke ground in New York.”
Globalfoundries chief executive officer Doug Grose will run the combined operations, ATIC has said. Chartered’s Chia will be chief operating officer and will be in charge of integrating the operations.