GlobalFoundries to acquire IBM's microelectronics business


— 9:12 AM on October 20, 2014

It's a big day for GlobalFoundries. Not only has the firm entered an agreement to acquire IBM's microelectronics business and associated patents, but it's also getting a $1.5-billion "cash consideration" from IBM to do so. I guess you can have your cake and eat it, too.

ARMONK, N.Y., and SANTA CLARA, Calif., - 20 Oct 2014: IBM (NYSE: IBM) and GLOBALFOUNDRIES today announced that they have signed a Definitive Agreement under which GLOBALFOUNDRIES plans to acquire IBM's global commercial semiconductor technology business, including intellectual property, world-class technologists and technologies related to IBM Microelectronics, subject to completion of applicable regulatory reviews. GLOBALFOUNDRIES will also become IBM's exclusive server processor semiconductor technology provider for 22 nanometer (nm), 14nm and 10nm semiconductors for the next 10 years.

In addition to the above, GlobalFoundries will take over IBM's manufacturing facilities in East Fishkill, New York and Essex Junction, Vermont. (The East Fishkill facility, incidentally, is not far from GlobalFoundries' new fab in Saratoga County.)

Furthermore, GlobalFoundries will acquire and attempt to grow IBM's commercial microelectronics business, which encompasses "ASIC and specialty foundry, manufacturing and related operations and sales." IBM and GlobalFoundries say the deal "opens up business opportunities in industry-leading radio frequency (RF) and specialty technologies and ASIC design capabilities," as well.

Last, but not least, GlobalFoundries will get "thousands of patents" out of the deal, which will turn it into "the holder of one of the largest semiconductor patent portfolios in the world."

IBM says it's shedding the division in order to "further focus on fundamental semiconductor research and the development of future cloud, mobile, big data analytics, and secure transaction-optimized systems." According to Reuters, the microelectronics business was losing money. One analyst has described the sale as taking "one troubled area out of [IBM's] core franchise."

   
Register
Tip: You can use the A/Z keys to walk threads.
View options

This discussion is now closed.