ATIC (co-owner of Globalfoundries) to Acquire Chartered Semiconductor

[MODEL3]

http://www.xbitlabs.com/news/o...red_Semiconductor.html

Advanced Technology Investment Company, a co-owner of Globalfoundries contract maker of semiconductors, on Monday proposed to acquire Chartered Semiconductor, another contract maker of chips. The transaction will help Chartered to continue developing new process technologies and build new production capacities, whereas ATIC will be able to more efficiently compete with companies like TSMC or UMC.

Chartered Semiconductor commands 11.3% of contract semiconductor manufacturing market. Taiwan Semiconductor Manufacturing Company and United Microelectronics Corp. command 14.1% and 49% of the market, respectively, according to iSuppli market research firm.

The 49% is for TSMC and the 14.1% for UMC.

I didn't know where to post it, here or in GH, but i remember a GF topic here.

EDIT*

From PCper ( http://www.pcper.com/ ) :

How is your holiday weekend going? Would you like to spend it reading about how some companies are spending $3.9 billion? As being reported on BusinessWire, and discussed earlier in the evening by SemiAccurate, ATIC, the company that owns GlobalFoundries (which used to be the manufacturing arm of AMD), is making a bid to purchase Chartered Semiconductor. Chartered is one of the more foundational manufacturing companies in the business today and has its hands in a lot of different markets with a lot of different customers.

And that could really be the big selling point in this deal for ATIC. We have long known the largest hurdle GlobalFoundries will face is getting new customers OTHER than AMD on board. With a successful purchase of Chartered Semi, ATIC would likely hurry along a merger of the two entities and thus create instant customer base for the GlobalFoundries group. Chartered would also provide ATIC with a total of six additional fab facilities including one 300mm production. What Chatered gains in the deal is access to more advanced technologies than it would have otherwise been able to offer as GlobalFoundries has been making the push to 28nm production very quickly.

This is of course still just a "bid" to buy the company but people I spoke with don't seem to think there are going to be any hurdles in the way of its completion. It should be an easy match for the three companies involved (ATIC, Chartered and GF) and help propel the unit to profit sooner than would otherwise have been possible.

 

[Idontcare]

Originally posted by: MODEL3
I didn't know where to post it, here or in GH, but i remember a GF topic here.

Can't speak for whether or not GH folks like to read about this stuff but the cpu forum folks most definitely do, as do the video forum folks.

 

[Bill Brasky]

Thanks for the post. I'll check out your links once I'm done with Anand's Lynnfield review.

 

[faxon]

so basically if ATIC merges GF with chartered, throws down a few $bn more to upgrade chartered to GFs latest fab tech at the same time, and finds customers to fill these fabs, that they would be the largest microchip manufacturer in the world, possibly with more fab capacity than intel? im not really familiar with chartered as a company, what makes up the bulk of their current manufacturing tech? and how many fabs do they have at this level?

 

[ViRGE]

Originally posted by: faxon
so basically if ATIC merges GF with chartered, throws down a few $bn more to upgrade chartered to GFs latest fab tech at the same time, and finds customers to fill these fabs, that they would be the largest microchip manufacturer in the world, possibly with more fab capacity than intel? im not really familiar with chartered as a company, what makes up the bulk of their current manufacturing tech? and how many fabs do they have at this level?

No. Intel would still be significantly bigger. Remember: Intel is a fab company that just happens to design chips so that they have something to build in their fabs. I'm not sure even adding up everyone else who isn't Intel would result in an entity bigger than Intel.

 

[faxon]

haha fair enough. i always forget just how damn huge intel is fab wise lol. would be interesting to see what volume of their fab production goes where (IE. CPUs, NAND Flash, Chipsets, other misc. ICs, GPUs, SOCs ect...)

 

[Viditor]

Originally posted by: ViRGE

Originally posted by: faxon
so basically if ATIC merges GF with chartered, throws down a few $bn more to upgrade chartered to GFs latest fab tech at the same time, and finds customers to fill these fabs, that they would be the largest microchip manufacturer in the world, possibly with more fab capacity than intel? im not really familiar with chartered as a company, what makes up the bulk of their current manufacturing tech? and how many fabs do they have at this level?

No. Intel would still be significantly bigger. Remember: Intel is a fab company that just happens to design chips so that they have something to build in their fabs. I'm not sure even adding up everyone else who isn't Intel would result in an entity bigger than Intel.

Top 5 Largest Fab companies in order...

1. Samsung
2. TSMC
3. Intel
4. Toshiba
5. UMC

 

[Keysplayr]

Originally posted by: Viditor

Originally posted by: ViRGE

Originally posted by: faxon
so basically if ATIC merges GF with chartered, throws down a few $bn more to upgrade chartered to GFs latest fab tech at the same time, and finds customers to fill these fabs, that they would be the largest microchip manufacturer in the world, possibly with more fab capacity than intel? im not really familiar with chartered as a company, what makes up the bulk of their current manufacturing tech? and how many fabs do they have at this level?

No. Intel would still be significantly bigger. Remember: Intel is a fab company that just happens to design chips so that they have something to build in their fabs. I'm not sure even adding up everyone else who isn't Intel would result in an entity bigger than Intel.

Top 5 Largest Fab companies in order...

1. Samsung
2. TSMC
3. Intel
4. Toshiba
5. UMC

Are you talking market cap? Or actual semi-conductor production of any and all flavors?

 

[Idontcare]

Originally posted by: Keysplayr

Originally posted by: Viditor

Originally posted by: ViRGE

Originally posted by: faxon
so basically if ATIC merges GF with chartered, throws down a few $bn more to upgrade chartered to GFs latest fab tech at the same time, and finds customers to fill these fabs, that they would be the largest microchip manufacturer in the world, possibly with more fab capacity than intel? im not really familiar with chartered as a company, what makes up the bulk of their current manufacturing tech? and how many fabs do they have at this level?

No. Intel would still be significantly bigger. Remember: Intel is a fab company that just happens to design chips so that they have something to build in their fabs. I'm not sure even adding up everyone else who isn't Intel would result in an entity bigger than Intel.

Top 5 Largest Fab companies in order...

1. Samsung
2. TSMC
3. Intel
4. Toshiba
5. UMC

Are you talking market cap? Or actual semi-conductor production of any and all flavors?

Not sure what metric Viditor is using, maybe wspm capacity?

Here's a graphic of most recent IC marketshare data (sales):

http://i.cmpnet.com/eetimes/se...2009/chart1_073009.gif

Now there is a fair amount of "double counting" that goes on there in that list when it comes to anyone who is a foundry versus an IDM. (for example AMD's sales in that chart is the total of both their cpu and gpu divisions, but gpu sales are also counted as TSMC sales, etc)

For a better view into just the foundry world look at this chart:

http://i.cmpnet.com/eetimes/se...2009/chart1_060809.gif

Chartered is pretty small in comparison to UMC and TSMC.

An analogy here is in the x86 world this news is the equivalent of IBM (an x86 license holder) buying Via's cpu division (3rd ranked in x86 sales, but tiny tiny sales volume compared to the other two)...its an interesting twist but adding chartered to globalfoundries is not exactly going to suddenly put them on par with TSMC in terms of annual sales/production volumes.

It does give them clients, pre-existing customers, who are contractually locked into Chartered so this will force globalfoundires to develop a deeper reputation of customer relations on a shorter timescale than they were going to have been on if they waited for 28nm customer feedback to trickle out into the market.

 

[Bill Brasky]

Originally posted by: Idontcare
snip

http://i.cmpnet.com/eetimes/se...2009/chart1_060809.gif

So I'm confused. Does Intel have a code name for their 'fab branch' if that exists, or are they not even in the top ten as indicated by your link?

 

[Phynaz]

Originally posted by: Zaitsev

Originally posted by: Idontcare
snip

http://i.cmpnet.com/eetimes/se...2009/chart1_060809.gif

So I'm confused. Does Intel have a code name for their 'fab branch' if that exists, or are they not even in the top ten as indicated by your link?

That chart shows the "pure play" foundry companies, companies that only manufacture chips - not design them.

 

[Idontcare]

Originally posted by: Phynaz

Originally posted by: Zaitsev

Originally posted by: Idontcare
snip

http://i.cmpnet.com/eetimes/se...2009/chart1_060809.gif

So I'm confused. Does Intel have a code name for their 'fab branch' if that exists, or are they not even in the top ten as indicated by your link?

That chart shows the "pure play" foundry companies, companies that only manufacture chips - not design them.

Yeah it just shows how diminutive Chartered Semiconductor is relative to UMC and TSMC. You can compare the numbers in that chart with the Intel number (and Samsung) from the other chart if you wanted to get a feel for how they all stack up.

 

[ViRGE]

Edit: I'm too late

 

[Viditor]

Originally posted by: Keysplayr

Originally posted by: Viditor

Originally posted by: ViRGE

Originally posted by: faxon
so basically if ATIC merges GF with chartered, throws down a few $bn more to upgrade chartered to GFs latest fab tech at the same time, and finds customers to fill these fabs, that they would be the largest microchip manufacturer in the world, possibly with more fab capacity than intel? im not really familiar with chartered as a company, what makes up the bulk of their current manufacturing tech? and how many fabs do they have at this level?

No. Intel would still be significantly bigger. Remember: Intel is a fab company that just happens to design chips so that they have something to build in their fabs. I'm not sure even adding up everyone else who isn't Intel would result in an entity bigger than Intel.

Top 5 Largest Fab companies in order...

1. Samsung
2. TSMC
3. Intel
4. Toshiba
5. UMC

Are you talking market cap? Or actual semi-conductor production of any and all flavors?

My bad...should have been clearer.
That is a list of semi-conductor companies in order of production not sales. Since 2 of those are pure play companies, sales wouldn't really work as a metric.
Memory is still the largest segment, which explains why Samsung the biggest.

For more, try

 

[Phynaz]

Originally posted by: Viditor

Originally posted by: Keysplayr

Originally posted by: Viditor

Originally posted by: ViRGE

Originally posted by: faxon
so basically if ATIC merges GF with chartered, throws down a few $bn more to upgrade chartered to GFs latest fab tech at the same time, and finds customers to fill these fabs, that they would be the largest microchip manufacturer in the world, possibly with more fab capacity than intel? im not really familiar with chartered as a company, what makes up the bulk of their current manufacturing tech? and how many fabs do they have at this level?

No. Intel would still be significantly bigger. Remember: Intel is a fab company that just happens to design chips so that they have something to build in their fabs. I'm not sure even adding up everyone else who isn't Intel would result in an entity bigger than Intel.

Top 5 Largest Fab companies in order...

1. Samsung
2. TSMC
3. Intel
4. Toshiba
5. UMC

Are you talking market cap? Or actual semi-conductor production of any and all flavors?

My bad...should have been clearer.
That is a list of semi-conductor companies in order of production not sales. Since 2 of those are pure play companies, sales wouldn't really work as a metric.
Memory is still the largest segment, which explains why Samsung the biggest.

For more, try

I would say sales is the most important metric for any company. Who cares if you produce a bazilion memory chips that are next to worthless? That's why AMD dumped its memory business.

 

[Viditor]

Originally posted by: Phynaz

I would say sales is the most important metric for any company. Who cares if you produce a bazilion memory chips that are next to worthless? That's why AMD dumped its memory business.

It is not a question of what's important, it's a question of being able to measure things...
You can't include a pure play Fab into the metric because their sales are measured differently than the in-house Fabs.

For example, to compare Intel to TSMC, you would need to know how much Intel sold the chip to itself for...that number doesn't exist. Remember that you're comparing TSMC to only Intel's Fab division...

 

[Phynaz]

Originally posted by: Viditor

Originally posted by: Phynaz

I would say sales is the most important metric for any company. Who cares if you produce a bazilion memory chips that are next to worthless? That's why AMD dumped its memory business.

It is not a question of what's important, it's a question of being able to measure things...
You can't include a pure play Fab into the metric because their sales are measured differently than the in-house Fabs.

For example, to compare Intel to TSMC, you would need to know how much Intel sold the chip to itself for...that number doesn't exist. Remember that you're comparing TSMC to only Intel's Fab division...

I don't get how you can sales are measured differently.

Sales = amount of compensation received for product sold or service rendered as far as I'm aware. This revenue recognition would would be bound by GAAP and IAS18 rules.

I'm interested in how TSMC's sales are measured differently than Intel's. Can you maybe give me an example? Thanks!

 

[Viditor]

Originally posted by: Phynaz

Originally posted by: Viditor

Originally posted by: Phynaz

I would say sales is the most important metric for any company. Who cares if you produce a bazilion memory chips that are next to worthless? That's why AMD dumped its memory business.

It is not a question of what's important, it's a question of being able to measure things...
You can't include a pure play Fab into the metric because their sales are measured differently than the in-house Fabs.

For example, to compare Intel to TSMC, you would need to know how much Intel sold the chip to itself for...that number doesn't exist. Remember that you're comparing TSMC to only Intel's Fab division...

I don't get how you can sales are measured differently.

Sales = amount of compensation received for product sold or service rendered as far as I'm aware.

I'm interested in how TSMC's sales are measured differently than Intel's. Can you maybe give me an example? Thanks!

Certainly...glad to help.

Intel's sales and profits are measured on the total functionality of the company. That is to say that they design, produce, market, and support semiconductor products.
TSMC is a pure play Fab. That means that they merely produce the semiconductor products that other companies design, support, and market. Therefore, TSMC's sales are based only on that portion of the business.

To compare the 2 would require you to know the sales income for only the Fab portion of Intel's business...in other words, you'd have to have an internal number of how much Intel pays itself for production of their parts. Put another way, Intel is Intel's only Fab client...

 

[Phynaz]

Okay, I get what you are saying. The assumption here is that Intel sells itself anything - which it may not. I'd even bet you a Twinkie that Intel's fabs are a different company, and don't sell a thing to Intel the holding company.

And I'd bet you two Twinkies the same holds true for TSMC, making the sales comparable after all.

 

[Viditor]

Originally posted by: Phynaz
Okay, I get what you are saying. The assumption here is that Intel sells itself anything - which it may not. I'd even bet you a Twinkie that Intel's fabs are a different company, and don't sell a thing to Intel the holding company.

And I'd bet you two Twinkies the same holds true for TSMC, making the sales comparable after all.

Huh? Intel intra-company sales may occur, but we certainly don't have access to that data...therefore (as was my point) we can't compare using sales numbers.

The original point was faxon's comment about the new GF being "the largest microchip manufacturer in the world, possibly with more fab capacity than intel?", and Virge thinking that Intel was the largest of all companies in terms of capacity...they aren't (unless he was thinking of specifically x86 CPUs).

 

[ViRGE]

Originally posted by: Viditor

Originally posted by: ViRGE

Originally posted by: faxon
so basically if ATIC merges GF with chartered, throws down a few $bn more to upgrade chartered to GFs latest fab tech at the same time, and finds customers to fill these fabs, that they would be the largest microchip manufacturer in the world, possibly with more fab capacity than intel? im not really familiar with chartered as a company, what makes up the bulk of their current manufacturing tech? and how many fabs do they have at this level?

No. Intel would still be significantly bigger. Remember: Intel is a fab company that just happens to design chips so that they have something to build in their fabs. I'm not sure even adding up everyone else who isn't Intel would result in an entity bigger than Intel.

Top 5 Largest Fab companies in order...

1. Samsung
2. TSMC
3. Intel
4. Toshiba
5. UMC

Do you have anything to back that up? Samsung I could believe due to their focus on memory, but I have a very hard time believing TSMC pushes out more silicon per year than Intel.

 

[Viditor]

Originally posted by: ViRGE

Originally posted by: Viditor

Originally posted by: ViRGE

Originally posted by: faxon
so basically if ATIC merges GF with chartered, throws down a few $bn more to upgrade chartered to GFs latest fab tech at the same time, and finds customers to fill these fabs, that they would be the largest microchip manufacturer in the world, possibly with more fab capacity than intel? im not really familiar with chartered as a company, what makes up the bulk of their current manufacturing tech? and how many fabs do they have at this level?

No. Intel would still be significantly bigger. Remember: Intel is a fab company that just happens to design chips so that they have something to build in their fabs. I'm not sure even adding up everyone else who isn't Intel would result in an entity bigger than Intel.

Top 5 Largest Fab companies in order...

1. Samsung
2. TSMC
3. Intel
4. Toshiba
5. UMC

Do you have anything to back that up? Samsung I could believe due to their focus on memory, but I have a very hard time believing TSMC pushes out more silicon per year than Intel.

I do, but my own source is NDA (payed for reports). However, I found a snippet at EETimes that basically says the same thing. Note that TSMC has grown significantly more than Intel since this report came out, but that they were ahead even then.

"Seven in the elite circle come from Asia, with South Korea's Samsung Electronics Co. Ltd grabbing majority of the market share in 2006. Taiwan Semiconductor Manufacturing Co. Ltd came in second, followed by Intel Corp., Toshiba Corp. and United Microelectronics Corp. The top five accounted for a combined capacity of over 2.9 million 200mm-equivalent wafers per month, translating to a 32-percent control of the industry's wafer fab capacity supply"

 

[ViRGE]

Fair enough. Thanks.

 

[MODEL3]

ATIC eyes even more acquisitions:

http://www.xbitlabs.com/news/o...More_Acquisitions.html

?We are always open to new opportunities. We won't rule out any opportunity. The first deal was in March, the second today and we are always open to more. You will see ATIC as a credible and successful leader in the semiconductor industry. We are a serious investor and in the next five years we have a clear path. ATIC is an investment company focused on high technology and we are very committed to it,?said Ibrahim Ajami, chief executive officer of ATIC

Potentially, ATIC could acquire any company or its semiconductor business from IBM?s process technology alliance since this would automatically increase the amount of customers without bringing necessity to make huge investments into development of process technologies. The alliance, based at IBM's facility in East Fishkill, New York, includes Chartered Semiconductor Manufacturing, Globalfoundries, Infineon Technologies, NEC Electronics, Samsung Electronics, STMicroelectronics, and Toshiba.