x Abu Dhabi, UAETuesday 23 January 2018

Abu Dhabi firm increases stake in microchip giant

Abu Dhabi's Advanced Technology Investment Company (ATIC) now owns an 86 per cent in one of the biggest microchip makers in the world after increasing its stake in Globalfoundries.

Atic accounted for 40 per cent of Mubadala's revenues. Above, engineers work in one of several clean rooms at Globalfoundries in Dresden, Germany.
Atic accounted for 40 per cent of Mubadala's revenues. Above, engineers work in one of several clean rooms at Globalfoundries in Dresden, Germany.

The Abu Dhabi-based Advanced Technology Investment Company (ATIC) has increased its investment in Globalfoundries, one of the biggest customised microchip makers in the world, through its US counterpart Advanced Micro Devices (AMD), according to a company filing.

ATIC now owns 86 per cent of Globalfoundries with AMD, the chipmaker's former owner, holding the remaining stake in the firm.

ATIC, an investment firm owned by the Abu Dhabi Government, purchased 65.8 per cent stake in Globalfoundries last year for $2.1billion (Dh 7.7bn)in a deal that placed the UAE as a leading player in the global microchip industry.

The investment firm later purchased Singapore's Chartered Semiconductor for US$5.6 bn (Dh14.64bn) that made Globalfoundries the world's third largest semiconductor foundry by revenue.

ATIC has pledged about $10bn in investment to Globalfoundries, with $3.6bn set aside to expand its current facilities in New York and Germany with the rest towards building Abu Dhabi's foundry.

In a filing to the US Securities and Exchange Commission yesterday, AMD said that ATIC's investment in Chartered Semiconductor has diluted its stake in Globalfoundries to 14 per cent.

ATIC transferred all the outstanding ordinary shares of its investment in the Singaporean firm to Globalfoundries in exchange for more than 2.8 million Class A preferred shares.

AMD said the dilution of its equity interest in Globalfoundries would result in a non-cash gain in first fiscal quarter of next year.

The company also said it would begin accounting for its investment in Globalfoundries using the cost method and will no longer recognise any financial contribution of the chipmaker in its statements of operations.

"ATIC bought Chartered Semiconductor one year ago to integrate it into Globalfoundries, offering the industry a truly global foundry company," said Brian Lott, the executive director of communications for ATIC.

"Customer response has been extremely positive, reinforcing this strategy and already creating demand for expansion."

 

dgeorgecosh@thenational.ae