A complex tech deal that stretches from Silicon Valley to Singapore to the Middle East could have even wider economic benefits for upstate, where a multibillion-dollar chip foundry is planned.
Abu Dhabi-owned Advanced Technology Investment announced this week that it will combine its chip-making business in Singapore, formerly known as Chartered Semiconductor, with Globalfoundries, a partnership with Silicon Valley’s Advanced Micro Devices.
By merging the operations, ATI will boost its stake in Globalfoundries to 86 percent from 70 percent while reducing AMD’s stake to 14 percent.
Globalfoundries, which has broken ground on a $7 billion chip plant in Saratoga County that has been called the largest capital construction project in New York state history, plans to make it the focus of its combined operations when it starts chip production in 2012.
The deal positions Globalfoundries to challenge No. 1 chipmaker Taiwan Semiconductor Manufacturing. As the former manufacturing arm of AMD, Globalfoundries also aims to reduce its reliance on AMD, which is its largest customer.
“This is a sign ATI is really committed” to take on Taiwan Semiconductor, said a person close to the situation.
ATI intends to expand Globalfoundries’ customer base beyond AMD by serving customers of its Singapore operations, the source added. AMD has an exclusive contract with Globalfoundries for chips that runs more than another decade, the source said.
Chip designers — a category that includes Intel and AMD — are eager to have a viable competitor to Taiwan Semiconductor, which controls about 70 percent of the market.
Globalfoundries’ plant in Malta, NY, about 25 miles north of Albany, is expected to create 1,400 high-tech jobs and has already hired several hundred. The plant will have 30-foot-high ceilings and span six football fields. It is expected to produce 60,000 chips a month.
“I suspect after this merger ATI will pause and completely focus on executing the merger and the New York plant,” the source said.
Globalfoundries currently makes many of its most advanced chips in Germany, but New York represents its high-end future. The Malta plant is being billed as the most advanced semiconductor manufacturing facility in the world when it opens in 2012.
The company may also add other plants in New York if there is enough demand, a company spokesman said.
The AMD/ATI joint venture was created in March 2009.