UAE-backed GlobalFoundries and TSMC announce $2bn manufacturing agreement

UAE-backed semiconductor firm GlobalFoundries has formed a $2 billion partnership with Taiwan Semiconductor Manufacturing Company (TSMC) to enhance US chip production. The New York-based company will supply TSMC with silicon interposers, crucial components that facilitate communication between chips on logic boards. GlobalFoundries' stock experienced a positive reaction to the announcement, up 2.8% to $49.44 per share.

Ed Kaste, a senior vice president at GlobalFoundries, emphasized the growing significance of advanced packaging in meeting the escalating demand for semiconductors, particularly in the realm of artificial intelligence. He stated that by leveraging GlobalFoundries' US manufacturing base, they are establishing a secure and scalable source of advanced-packaging elements, thereby enabling customers to accelerate innovation and fortify the semiconductor supply chain.

GlobalFoundries anticipates commencing large-scale production of silicon interposers at the beginning of 2028. The company's press release highlighted that this agreement serves as a foundation for future capacity expansion as customer demand increases. TSMC, a leading global chip manufacturer, previously announced plans to invest at least $100 billion in the US to bolster manufacturing and research.

Last year, President Donald Trump highlighted the strategic importance of this collaboration, stating that the most powerful AI chips will be developed in America, with a substantial portion being produced by TSMC.