Globalfoundries, Defense in $117M deal
Facility in Malta to supply semiconductor chips for the country’s national security systems
Globalfoundries has entered into a $117 million agreement with the U.S. Department of Defense to supply semiconductor chips for the country’s national security systems.
The semiconductor manufacturer will transfer equipment from its recently sold East Fishkill facility to the newer fab in Malta to produce the 45-nanometer chips.
“The transfer of this critical technology to Fab 8 will rely on existing tools at the Malta facility, new equipment purchases, and the transfer of unique tooling from East Fishkill to Malta,” a Globalfoundries spokesperson said.
The manufacturing will take place in Malta. The company declined to disclose equipment relocation costs.
Globalfoundries announced the East Fishkill plant would be acquired by ON Semiconductors in April 2019 but only recently finalized the sale after having to wait three years for the Hartscott-rodino Antitrust Improvements Act of 1976 to expire.
The company is working with the federal government to gain “trusted foundry” status for the Malta fab and expects to begin delivering chips to the Department of Defense in 2023. Globalfoundries said the chips will be used in the nation’s most sensitive defense and aerospace applications.
While the Malta Fab does have some classifications under the U.S. International Traffic in Arms Regulations and Export Administration Regulations, it
does not have the same “trusted foundry” status as its sister fab in Vermont or the former East Fishkill location.
The relationship between the Department of Defense and Globalfoundries was bolstered last year after the department upped its contract to pay the semiconductor maker $1.1 billion for chips from its previous $400 million agreement. The relationship is essential to both parties as it puts Globalfoundries on the map as a premier chip provider and secures a steady supply for the government.
“The strong public-private partnership demonstrated with this new supply and tech transfer agreement is an excellent example of the impact federal collaboration and investment in semiconductor manufacturing can have on strengthening domestic supply chains,” Globalfoundries CEO Tom Caulfield said in a news release.
“Our partnership boosts the national economy while also securing a strategic and reliable supply of chips needed by the U.S. government for aerospace, defense, and other missioncritical applications,” he added.