GlobalFoundries stock rises on U.S.-Japan semiconductor deal

Investing.com -- GlobalFoundries (NASDAQ: GFS) shares rose 4% after the company announced it was selected to operate two new semiconductor manufacturing facilities in Malta, New York, under a U.S.-Japan initiative providing up to $21 billion in funding.

The initiative, enabled by President Donald J. Trump’s trade and investment agreement with Japan, will see Japan provide the investment while GlobalFoundries contributes its technologies and operational capabilities as technology provider and operator.

An initial investment of approximately $10 billion will accelerate construction of a new 300mm semiconductor fab expected to come online in 2029. An additional $10 billion investment would fund a second fab. The first fab is expected to add approximately 900,000 300mm wafers of annual U.S. manufacturing capacity when fully operational, with a second fab adding roughly the same amount.

The project is expected to create about 27,000 construction and ecosystem jobs and more than 1,000 manufacturing jobs in New York’s Capital Region. GlobalFoundries expects to break ground on the first fab at its Malta site later this year.

In a separate agreement, GlobalFoundries amended its existing CHIPS and Science Act award to reallocate $955 million and accelerate investments in silicon photonics, silicon-germanium and advanced packaging at its facilities in Malta, New York, and Burlington, Vermont. The U.S. Department of Commerce will receive equity in GlobalFoundries of approximately 4%.

The new capacity builds on customer relationships across the United States and Japan. Renesas CEO Hidetoshi Shibata said the company is planning around GlobalFoundries’ new capacity in New York as an extension of Renesas’ own production footprint. Apple COO Sabih Khan noted that GlobalFoundries is an inaugural member of Apple’s American Manufacturing Program, part of Apple’s $600 billion commitment to American investment.

Original Article

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