Abu Dhabis investment arm is considering a sale of all or part of chipmaker Globalfoundries Inc. as the emirate explores asset disposals amid a slump in crude oil, people familiar with the matter said.
Sovereign fund Mubadala Development Co. has held early talks with potential acquirers, the people said, asking not to be identified as the information is private. No final decision has been made and discussions could still fall apart, the people said. A transaction could value the business at $15 billion to $20 billion, the people said.
And that there is too much cash in the market.
Someone should buy them and AMD, put the band back together
GloFo has about $6 billion in annual revenues? That's a lot better than I would have expected...
Chinese, they want to get rid of Intel and USA once at all, but they need AMD, the fabs and the tech too in order to be stronger.But who on Earth will buy Global Flounderings?
This is one of those companies that is unsellable, anyone who buys it at this stage of the semiconductor game runs the risk of bankruptcy. I laugh at the $15 billion estimate.
Only possible buyer might be Chinese government (via proxy, indirect support to their semiconductor companies). That, so they can gain some IP knowledge for their own homegrown semiconductor companies. Problem with this is lot of the real IP knowhow is with upstream suppliers (like AMSL), so you gain only a limited amount of commerically exploitable knowledge buying out someone like GloFlo.
The other thing is that entire semiconductor business is heading towards a wall anyway, even Intel is struggling with shrinks. And the next breakthrough will have to come with some entirely new type of material and manufacturing, so does it make any sense to spend $15 on GloFlo now?
Call me crazy but I'd rather gamble all that money on R&D of some entirely unproven and new manufacturing techniques.
If anyone pays $15 billion for Gloflo, it would only prove their idiocy. And that there is too much cash in the market.
GloFo has about $6 billion in annual revenues? That's a lot better than I would have expected...
Gartner says $4.4b in 2014:
http://www.gartner.com/newsroom/id/3027717
Given that that's down from 2013 I'd be really surprised if they hit $6b for 2015.
For comparison, AMD's revenue was $5.5b in 2014 and we all know how well they're doing.
But who on Earth will buy Global Flounderings?
This is one of those companies that is unsellable, anyone who buys it at this stage of the semiconductor game runs the risk of bankruptcy. I laugh at the $15 billion estimate.
Only possible buyer might be Chinese government (via proxy, indirect support to their semiconductor companies). That, so they can gain some IP knowledge for their own homegrown semiconductor companies. Problem with this is lot of the real IP knowhow is with upstream suppliers (like AMSL), so you gain only a limited amount of commerically exploitable knowledge buying out someone like GloFlo.
The other thing is that entire semiconductor business is heading towards a wall anyway, even Intel is struggling with shrinks. And the next breakthrough will have to come with some entirely new type of material and manufacturing, so does it make any sense to spend $15 on GloFlo now?
Call me crazy but I'd rather gamble all that money on R&D of some entirely unproven and new manufacturing techniques.
If anyone pays $15 billion for Gloflo, it would only prove their idiocy. And that there is too much cash in the market.
Gartner says $4.4b in 2014:
http://www.gartner.com/newsroom/id/3027717
Given that that's down from 2013 I'd be really surprised if they hit $6b for 2015.
For comparison, AMD's revenue was $5.5b in 2014 and we all know how well they're doing.
The arabs are only selling because its a sinkhole for money.
Abu Dhabi is reviewing state-owned companies, including Mubadala, for potential asset sales, as the slump in crude oil pressures the emirates finances, people familiar with the matter said last month. The emirate had a long-term plan to build a chip factory there to diversify its economy away from a dependence on oil.
I don't know if that's exactly true. The article linked by the OP said:
Mubadala might be forced to liquidate regardless of whether or not GF is a money pit. The irony is that GF actually has a chance to do some good work thanks to the IBM fab/talent acquisition and the opportunity to succeed in rolling out 14nm LPP in 2016. GF has been a liability ever since 28nm (no SOI), but now they have a chance to improve their situation. And now Mubadala is being forced to shop around their share.
A good example is the part they got from IBM. That one alone lost 700M$. GloFo is a nightmare.
Gf will never be good business with mubadala as owners. The hillarious thing is its always like you are looking for potential in the portfolio but here the potential is on the owner side.The Chinese will buy it... They need it to improve their Loongson tech and having the required fabs to produce and needs also AMD as the x86 perfect compiler. Also AMD's GPU tech is the only competent tech who is cheap.
They need VIA too due their hybrid x86 and ARM tech and add MIPS to the equation or ditch x86 and put MIPS on there.
In few words, China is starting to adquire companies in order to become independant, so there is not crazy thing there...
Finally the arabs are incompetent compared to China or Taiwan... So put GloFo on good hand and....
Samsung will pick them up, fire the locals and staff them with South Koreans.
Samsung will pick them up, fire the locals and staff them with South Koreans.
From a technical point of few, IBM's 22nm SOI process is far better than anything GF has used for market-ready products. It's expensive, but at least it works (unlike 28nm SOI from GF or 20nm from GF). 22FDX also shows some promise.