ON Semiconductor Corporation (Nasdaq: ON)
(“ON Semiconductor”) and GLOBALFOUNDRIES today announced that they have
entered into a definitive agreement for ON Semiconductor to acquire a
300mm fab located in East Fishkill, New York. The total consideration
for the acquisition is $430 million, of which $100 million has been paid
at signing of the definitive agreement, and $330 million will be paid at
the end of 2022, after which ON Semiconductor will gain full operational
control of the fab, and the site’s employees will transition to ON
Semiconductor. Completion of the transaction is subject to regulatory
approval and other customary closing conditions.
The agreement allows ON Semiconductor to increase its 300mm production
at the East Fishkill fab over several years, and allows for
GLOBALFOUNDRIES to transition its numerous technologies to the company’s
three other at-scale 300mm sites. Under the terms of the agreement,
GLOBALFOUNDRIES will manufacture 300mm wafers for ON Semiconductor until
the end of 2022. First production of 300mm wafers for ON Semiconductor
is expected to start in 2020.
The agreement also includes a technology transfer and development
agreement and a technology license agreement. This provides a world
class, experienced 300mm manufacturing and development team to enable
conversion of ON Semiconductor wafer processes from 200mm to 300mm. ON
Semiconductor will also have immediate access to advanced CMOS
capability including 45nm and 65nm technology nodes. These processes
will form the basis for future technology development at ON
Semiconductor.
“We are pleased to welcome the GLOBALFOUNDRIES Fab10 team to ON
Semiconductor’s team. The acquisition of 300 mm East Fishkill fab is
another major step in our progress towards leadership in power and
analog semiconductors,” said Keith Jackson, president and chief
executive officer of ON Semiconductor. “The acquisition adds additional
capacity over the next few years to support growth in our power and
analog products, enables incremental manufacturing efficiencies, and
accelerates progress towards our target financial model. I am very
excited about the opportunity this acquisition creates for customers,
shareholders, and employees of the two companies and look forward to a
successful partnership with GLOBALFOUNDRIES in the coming years.”
“ON Semiconductor is an ideal partner for GLOBALFOUNDRIES and this
agreement is a transformative step in our journey to build
GLOBALFOUNDRIES into the world’s leading specialty foundry,” said Tom
Caulfield, CEO at GLOBALFOUNDRIES. “This partnership enables
GLOBALFOUNDRIES to further optimize our assets globally and intensify
our investments in the differentiated technologies that fuel our growth
while securing a long-term future for the Fab 10 facility and our
employees.”
“We are excited to support ON Semiconductor’s expansion to the
Mid-Hudson Region, which will keep high paying manufacturing jobs in New
York State and support the company’s plan for future growth and
development,” said Howard Zemsky, president and CEO at Empire State
Development.
Teleconference
ON Semiconductor will host a conference call for the financial community
at 9:00 a.m. Eastern Standard Time (EST), on April 22, 2019, to discuss
this announcement. ON Semiconductor will also provide a real-time audio
webcast of the teleconference on the Investors page of its website at http://www.onsemi.com.
The webcast replay will be available at this site approximately one hour
following the live broadcast and will continue to be available for
approximately one year following the conference call. Investors and
interested parties can also access the conference call through a
telephone call by dialing (877) 356-3762 (U.S./Canada) or (262) 558-6155
(International). In order to join this conference call, you will be
required to provide the Conference ID Number – which is 7881834.
About ON Semiconductor
ON Semiconductor (Nasdaq: ON)
is driving energy efficient innovations, empowering customers to reduce
global energy use. The Company is a leading supplier of
semiconductor-based solutions, offering a comprehensive portfolio of
energy efficient power management, analog, sensors, logic, timing,
connectivity, discrete, SoC and custom devices. The Company’s products
help engineers solve their unique design challenges in automotive,
communications, computing, consumer, industrial, medical, aerospace and
defense applications. ON Semiconductor operates a responsive, reliable,
world-class supply chain and quality program, a robust compliance and
ethics program and a network of manufacturing facilities, sales offices
and design centers in key markets throughout North America, Europe and
the Asia Pacific regions. For more information, visit http://www.onsemi.com.
ON Semiconductor and the ON Semiconductor logo are registered
trademarks of Semiconductor Components Industries, LLC. All other brand
and product names appearing in this document are registered trademarks
or trademarks of their respective holders. Although the Company
references its website in this news release, information on the website
is not to be incorporated herein.
About GLOBALFOUNDRIES
GLOBALFOUNDRIES is a leading specialty foundry delivering truly
differentiated semiconductor technologies for a range of high-growth
markets. GLOBALFOUNDRIES provides a unique combination of design,
development, and fabrication services, with a range of innovative IP and
feature-rich offerings including FinFET, FDX™, RF and analog mixed
signal. With a manufacturing footprint spanning three continents, GF has
the flexibility and agility to meet the dynamic needs of clients across
the globe. GLOBALFOUNDRIES is owned by Mubadala Investment Company. For
more information, visit www.globalfoundries.com.
Cautions regarding Forward-Looking Statements
This document contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These
forward-looking statements include, but are not limited to statements
related to the consummation and benefits of the acquisition by ON
Semiconductor of the East Fishkill fab from GLOBALFOUNDRIES, including
statements about 300mm wafer production, transfers of technology, the
benefits of technology transfer and license agreements, anticipated
optimization of manufacturing, and progress towards ON’s previously
announced financial model. These forward-looking statements are based on
information available to ON Semiconductor as of the date of this release
and current expectations, forecasts and assumptions and involve a number
of risks and uncertainties that could cause actual results to differ
materially from those anticipated by these forward-looking statements.
Such risks and uncertainties include a variety of factors, some of which
are beyond our control. In particular, such risks and uncertainties
include, but are not limited to the risk that one or more closing
conditions to the transaction may not be satisfied or waived, on a
timely basis or otherwise, and the risk that the transaction does not
close when anticipated, or at all, including the risk that the requisite
regulatory approvals may not be obtained. Information concerning
additional factors that could cause results to differ materially from
those projected in the forward-looking statements is contained in ON
Semiconductor’s Annual Report on Form 10-K, Quarterly Reports on Form
10-Q, Current Reports on Form 8-K and other of ON Semiconductor’s
filings with the Securities and Exchange Commission. These
forward-looking statements are as of the date hereof and should not be
relied upon as representing our views as of any subsequent date, and we
do not undertake any obligation to update forward-looking statements to
reflect events or circumstances after the date they were made, except as
may be required by law. For additional information, visit ON
Semiconductor’s corporate website, www.onsemi.com,
or for official filings visit the SEC website, www.sec.gov.
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