SAN FRANCISCO—Advanced Technology Investment Co., the majority investor in Globalfoundries Inc., plans to spend up to $7 billion to build a semiconductor fab in Abu Dhabi, the capital of the United Arab Emirates, according to a report by the Wall Street Journal.
The story, based on an interview with ATIC CEO Ibrahim Ajami, says Ajami also said ATIC is open to acquisitions outside of the semiconductor foundry sector to strengthen its position in the chip business.
Ajami told The Journal that ATIC has targeted 2014 or 2015 to ramp up a 300-mm fab in Abu Dhabi, which would be operated by Globalfoundries.
Globalfoundries, which was formed in 2009 through the spinoff of Advanced Micro Devices Inc.'s manufacturing capabilities, operates seven fabs, including former AMD fabs based in Germany and several Singapore fabs, which were previously operated by Chartered Semiconductor Manufacturing Pte., which it acquired in early 2010. The company is also building a 300-mm fab in upstate New York.
Globalfoundries, bolstered by the deep pockets of ATIC, has quickly emerged to pose a technology and capacity challenge to Taiwan Semiconductor Manufacturing Co., the dominant player in the foundry market.
This is not the first time Wall Street is misleading. This makes no sense: no infrastructure, no engeering resources, no customer base. What's next: a fab in Africa by an African prince? I wonder which stock benefit by this kind or rumor?
Bolaji, I agree this is largely ego and pride driven. I am sure kings of oil are dreaming of having their own chips, computers with Arabic keyboard, cell phone based on internal standards. True, there is no silicon infrastructure there but they started importing bright EEs and building strong educational programs (number of my students received offers from Middle East). But foundry is an anchor of such infrastructure (see what Germany did in Dresden). As long as West consumes oil and dollars flow there this will happen, sooner or later. At about the time that Europe will be shutting down their next fab due to pollution and high labor costs...Kris
Like competing phone plans, ATIC might with government assistance be able to reimburse customers who "make the switch" to GF. That could get the momentum rolling. Otherwise, inertia is not in their favor.
@bolaji.ojo, I bet people said similar things when Taiwan started down this path. The reality is that you've got to start from somewhere. Abu-Dhabi has major comparative advantages: 1) deep pockets , 2) cheap energy, and even 3) geography. The last point might come to a surprise to you, but the UAE is a couple of hours flight or so from India (a super-power in the making) and not very far from China either. The balance of economic power is inevitably shifting from the west towards these two giants, and the rulers of the UAE know this very well. They control most of GF financially and I do not see why they should not build a fab in their own backyard and build the necessary eco-system that comes with it. Good luck to them I would say!
It is a brave move.
I support strongly to take this kind of advance technology to middle east region
I also appreciate ABU DHABI for investing the money, rather than keeping money simply.
I can see IBRAHIM AJMI as "Morris Chang" of Taiwan. May be people also would have questioned morris chang when he initially talked about Foundry in Taiwan.
As Boloji mentioned there are many issues Abu dhabi have to overcome like water, ecosystem, manpower, demand...etc.
TSMC--- Truly taiwan
Global foundries- Truly Global ( Asia, Europe, America, middle east....)
A fab in Abu Dhabi? It's not going to happen. To what purpose? A chip fab is not a piece of jewelry or just another fashion accessory. It is an expensive piece of the electronics supply chain puzzle. It needs numerous other elements to make it viable and I don't see any of these in Abu Dhabi. If GlobalFoundries and ATIC want to use a chip fabrication facility as a boasting tool, they will find they simply flushed billions down the toilet. Abu Dhabi's investment in the semiconductor industry is good for the industry--companies like AMD benefited from ATIC's capital outlay--but a foundry in the region proves nothing beyond confirming to skeptics this was ego-driven. The money would be better used setting up fabs near where Globalfoundries already has plants and where the supportive facilities--test and assembly plants, a vibrant design community, engineers, machinists, for instance--already exist and importantly, where there's a market for the output. Abu Dhabi has none of these. The managers of ATIC may sound off about their Abu Dhabi chip fab dreams but I doubt they would be egotistic enough to actually plunk one down in the area.
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