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Intel Starts Talks to Buy GlobalFoundries

We usually talk about CPUs and GPUs manufactured under the most advanced nodes, but there is a huge market for processors that use less advanced manufacturing nodes, especially companies with semi-custom design methodology, which are the majority of the market. That is why large foundries that manufacture for third parties continue to maintain the old nodes for semiconductors that do not need them.

Intel on the other hand until now only manufactured for itself, so when a node was no longer useful for its new products, and the previous ones had already completed their life cycle, they dismantled the old ones completely. The problem with the new strategy of being a third party foundry? Intel needs to redeploy those nodes and this is where its buying interest for GlobalFoundries comes in. Although it is best that we go to the details.

Intel interested in buying from GlobalFoundries

According to the Wall Street Journal, Intel would have made a purchase offer to GlobalFoundries for 30,000 million dollars. The company is currently in the hands of Mubadala Investment, an investment company owned by the Abu Dhabi government, but incorporated in the United States.

Intel’s purchase of GlobalFoundries would give the latter the opportunity to manufacture chips that are less complex and for much smaller customers, but which by volume are a good part of the market. Since not all companies in the sector have the economic capacity to develop semiconductors with the most advanced nodes. Intel’s war with TSMC is not only a zero-sum war with a geopolitical background, since the United States government sees it as a strategic sector and is going to support Intel in every possible way so that the majority of chips possible are made in the USA.

How does this affect Intel’s rival AMD?

GlobalFoundries was born from the spin-off of the manufacturer from AMD itself, which became a design-only company and therefore Fabless. Currently, AMD’s partner is TSMC, but until not long ago they used the GlobalFoundries factories, since without going any further the AMD Ryzen 1000 and 2000 CPUs, as well as the AMD Radeon GPUs were manufactured in the GlobalFoundries facilities. Even this foundation has a stake in current AMD CPUs, where the IOD, the largest chiplet responsible for communication in the system, is GlobalFoundries.

The foundry had to realize the AMD Zen 2 to 7 nm, but its retirement of the race when seeing that it was not profitable for them to continue the technological race against Intel and TSMC. Throughout this time they have continued to offer their old nodes, but their main source of income has been thanks to being the manufacturers of the IOD in the AMD Ryzen 3000 and AMD Ryzen 5000. Manufacturing contract that ends this year and everything indicates that it will be TSMC the one that will manufacture this part in the following AMD Ryzen based on Zen 4.