‘BIG DAY’ FOR MUBADALA AS CHIP MAKER LISTS SHARES IN US
▶ Globalfoundries, owned by Abu Dhabi fund, valued at nearly $26bn after Nasdaq debut
Chip maker Globalfoundries, the world’s third-largest semiconductor manufacturer, owned by Abu Dhabi’s Mubadala Investment Company, has raised about $2.6 billion in its initial public offering in the US.
The New York-based company’s shares began trading on the Nasdaq Global Select Market on Thursday under the ticker symbol “GFS”.
Globalfoundries set the initial public offering price at $47 a share, at the higher end of its targeted price range, after marketing the shares for $42 to $47. This gave the company a market value of nearly $26bn.
The stock was trading at $46.95 at 8.02pm UAE time on Thursday.
“It is the big day for Globalfoundries, Mubadala and Abu Dhabi. We created Globalfoundries 12 years ago because we felt it was important to invest in the technologies of tomorrow,” Khaldoon Al Mubarak, group chief executive and managing director of Mubadala Investment Company, told The National.
With the aim of increasing its production capacity by nearly 50 per cent in the next three years to address the pandemicinduced global chip shortage, Globalfoundries sold nearly 55 million ordinary shares, representing almost 10 per cent of its share capital.
More than 30.2 million shares were offered by the manufacturer and more than 24.7 million were offered by Mubadala.
Mubadala has also granted the underwriters a 30-day option to buy more than 8.2 million additional ordinary shares at the public offering price, less underwriting discounts and commissions.
The IPO was led by Morgan Stanley, Bank of America, JPMorgan, Citigroup and Credit Suisse Group.
Thursday’s listing in New York is a milestone transaction for a technology company that is backed by a sovereign wealth fund from the Middle East.
“Globalfoundries’ semiconductors are vital for many of the technologies we rely on every day … including the chips in mobile phones, the smart devices in your home and the safety features in your car,” Mr Al Mubarak said.
Globalfoundries, the world’s third-largest semiconductor manufacturer, which is owned by Abu Dhabi’s Mubadala Investment Company, raised nearly $2.6 billion in its initial public offering in the US amid strong demand from investors.
The company, based in New York, set the IPO price at $47 per share, at the higher end of its targeted price range after marketing the shares for $42 to $47. This gives it a market value of nearly $26 billion.
The company’s shares began trading on the Nasdaq Global Select Market on Thursday under the ticker symbol “GFS”.
“It is the big day for Globalfoundries, Mubadala and Abu Dhabi,” Khaldoon Al Mubarak, chief executive and managing director of Mubadala Investment Company, told The National. “We created Globalfoundries 12 years ago because we felt it was important to invest in the technologies of tomorrow.
“Globalfoundries’ semiconductors are vital for many of the technologies we rely on every day including the chips in mobile phones, the smart devices in your home and the safety features in your car,” said Mr Al Mubarak.
Globalfoundries, which aims to increase its production capacity by nearly 50 per cent in next three years to address the Covid-induced global chip shortage, sold nearly 55 million ordinary shares representing almost 10 per cent of its share capital. More than 30.2 million shares were offered by the semiconductor manufacturer and more than 24.7 million were offered by Mubadala.
Mubadala has also granted the underwriters a 30-day option to purchase up to an additional 8.2 million ordinary shares at the public offering price, less underwriting discounts and commissions.
The IPO was led by Morgan Stanley, Bank of America, JP Morgan, Citigroup and Credit Suisse Group.
The listing is a landmark transaction for a technology company backed by a Middle East sovereign wealth fund.
Globalfoundries was established in 2009 after Mubadala acquired the semiconductor manufacturing assets of Advanced Micro Devices. After the acquisition, Globalfoundries started making chips for other companies in addition to AMD.
In October 2014, Globalfoundries acquired International Business Machines’ microelectronics division with manufacturing facilities in New York and Vermont, in a deal which added to its global presence.
The company employs more than 15,000 people globally, has about 10,000 global patents and serves more than 200 customers worldwide, including the US government.
“Going public brings not only the new disciplines that come with an IPO but also a sign of the stature, stability and potential of Globalfoundries,” Mr Al Mubarak said.
The listing is the third largest on a US exchange this year by deal size. South Korea’s e-commerce company Coupang’s had a $4.5bn IPO and Chinese ride-hailing company DiDi Global’s listing raised $4.4bn, according to data compiled by Bloomberg.
Technology mega-trends such as the Internet of Things, 5G, cloud, artificial intelligence and next-generation automotive are reshaping the semiconductors industry. It is a market that is expected to grow to more than $1 trillion by the end of this decade, from close to $500 billion this year, according to VLSI Research.
“Semiconductors have become ubiquitous, powering a broad range of applications,” Globalfoundries said. “Semiconductor innovation is essential to the growth and development of many parts of the technology ecosystem.”