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Globalfoundries, a leading contract maker of semiconductors controlled by ATIC and AMD, plans to spend whopping $5.4 billion on expansion of its current facilities as well as on building its new manufacturing facility in the state of New York.

The capital spending of Globalfoundries in 2011 will be two times higher compared to capital expenditures in 2010, something which points to intensification of competition on the foundry market as well as rapid expansion of the contract manufacturers. The firm needs to build the new factory in Saratoga Country, New York, expand existing fab in Dresden, Germany and also finance its other production facilities, including the one that will be located in Abu Dhabi.

“This is based on customer programs and requests. This isn’t speculative,” said Robert Krakauer, chief financial officer of Globalfoundries, in an interview with Bloomberg news-agency.

At the company's leading-edge Dresden manufacturing campus, Fab 1, the expansion focus will be on adding new capacity to support additional growth opportunities for 45/40/28nm technologies as well as initial 22nm development. This expansion will see a new facility constructed at Fab 1 that will add nearly 110 thousand square feet of clean room space to enable the site to scale output up to 80 thousand wafers per month over the next two years. To support long-term growth at the 22/20nm generation, Globalfoundries expanded the size of Fab 2's cleanroom to approximately 300 thousand square feet, which will enable a total output of approximately 60 thousand wafers per month once fully ramped. In addition to new expansion initiatives in Dresden and New York, Globalfoundries also has been expanding its Fab 7 in Singapore to reach an output level of 50 thousand wafers per month to manufacture technologies ranging from the 65nm to 40nm technology nodes. When all the new expanded facilities become fully operational, total Globalfoundries’ 300mm output will be around 190 thousand wafers per month.

Globalfoundries produces chips for AMD, Qualcomm, STMicroelectronics and has a strategic relationship with ARM Holdings. The company is also a partner of IBM's so-called fab club and it inherited its state-of-the-art manufacturing facilities from AMD along with all proprietary know-how that had taken many years to develop.

CapEx of TSMC in 2011 will greatly exceed $5.9 billion spent in 2010. Capital spending of companies like Intel Corp. or Samsung Electronics is even higher, but they are much larger than Globalfoundries or Taiwan Semiconductor Manufacturing Company.

Tags: Globalfoundries, AMD, ATIC, Business, Semiconductor, 300mm, 32nm, 28nm, 22nm, 45nm

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