Aggressive move
We suspected ATIC (Advanced Technology Investment Company), which is wholly owned by the government of Abu Dhabi, was aggressive when it bought AMD's manufacturing operations and created Global Foundries (GF). Now we know it is.
ATIC has announced it is buying Singapore based Chartered Semiconductor, one of the world's biggest semiconductor foundries, for a total value of $3.9 billion, to significantly increase its already substantial stake in that market.
Owning GF gives ATIC a presence in two of the three most economically important global regions - North America and Europe; the acquisition of Chartered completes the set. And it's interesting that ATIC has chosen to buy Chartered itself, rather than through GF - in which AMD is still a minority shareholder - especially since GF boss Doug Grose will become the CEO of the combined operations.
Chartered seems to be struggling to find the billions needed to invest in keeping its foundries up to date, just as AMD was before ATIC stepped in. It upgraded its Q3 guidance today, but still expects to make a loss of $18 million.
"Given the importance of scale and the need for substantial, continued capital investment, and having carefully assessed all strategic options available to Chartered, we believe this transaction provides Chartered shareholders the opportunity to realize their investment," said Chartered chairman Jim Norling.
This move further confirms ATIC's strategy of targeting the SoC (System on Chip) market. The last press release issued by Chartered before today announced a collaboration with ARM, Samsung and IBM to optimise the design and manufacture of SoCs using the Common Platform 32/28nm process.
"Chartered and Global Foundries are well positioned to meet the growing chip demand to come from billions of new mobile phones, cars, televisions, computers and other devices," said Ibrahim Ajami, CEO of ATIC.
