Mubadala Investment Company is an Abu Dhabi-based government-owned investment and development company that has played a major role in the formation, growth and expansion of GlobalFoundries, a leading independent semiconductor manufacturer. Established in 2013, GlobalFoundries provides complete foundry solutions from advanced technology nodes down to mature nodes across multiple products and provides services ranging from process development to manufacturing of integrated circuits (ICs) for a range of high performance applications. Mubadala holds a majority stake in GlobalFoundries and demonstrates its commitment to its growth with continued investments. Through Mubadala’s investments, the company expanded its DuPont Fab line at its Fab 8 facility in Malta, NY and added two new fabs in Singapore (Fab 7A) and Da Vinci City (Fab 7B).
Through this financial ambition, GlobalFoundries has become more prominent as a major supply chain partner for companies looking for a customised response from an ASIC or complex SoC supplier. By providing consistent access to cutting-edge technology nodes such as 22FDX as well as longstanding technologies such as 200 mm production capable processes including 130 nm up to 28nm, several 7 nanometer options including EUV (extreme ultraviolet lithography), GlobalFoundries has established itself as one of the go-to resources for anyone looking for quality chip manufacturing services on leading edge technology platforms. This has given it the required competitive edge to offer chip production services at various volumes while maintaining competitive prices on all wafers produced by their fans.
Overview of Mubadala
Mubadala is an Abu Dhabi-based investment firm backed by the Government of Abu Dhabi. Established in 2017, it has invested in various industries including technology, renewable energy and healthcare.
One of Mubadala’s most significant investments is GlobalFoundries, a semiconductor manufacturer that recently raised $2.6 billion in an Initial Public Offering (IPO) in the US.
Let’s take a closer look at Mubadala’s role in GlobalFoundries.
History of Mubadala
Mubadala Investment Company, established in 2002, is a leading Abu Dhabi-based investment firm that combines the power of capital with strategic capabilities for long-term investments in various industries. Mubadala has many interests, from technology to real estate and agriculture.
We focus on investing in technology, real estate and the agribusiness sector. Our portfolio hosts iconic companies in defence, aerospace and healthcare sectors. Our portfolio includes Mosaic Ventures and the Abu Dhabi Future Energy Technology Company (Masdar). With one of the largest Defence Industry Businesses operating globally, we have significantly transformed the UAE’s defence industry over the past 20 years by establishing diverse joint ventures with global industry leaders such as General Dynamics and Lockheed Martin.
In 2014 we became a founding investor in GlobalFoundries Inc., the world’s largest dedicated semiconductor foundry provider in Asia and Europe. This groundbreaking venture creates advanced semiconductor products that range from low-power chips used in customer electronic devices to high-performance computing products used by domain manufacturers like AMD. In addition, this venture allows us to access exclusive fabrication technologies, providing an ideal platform for economic diversification efforts based on patient capital deployed for long-term growth and research and development projects through our network of global partners.
Our active partnership between GlobalFoundries Inc provides us an innovative ecosystem of innovation networks, continuous learning opportunities, platforming resources and technological capabilities that allow us to invest worldwide and remain at the forefront of technological advancements to drive economic growth worldwide.
Investment Strategy
Mubadala’s investment strategy aims to harness the potential of key sectors in the UAE economy, focusing on technology, advanced manufacturing, aerospace and logistics; life sciences; and financial services. To ensure that the company’s investments effectively serve UAE economic objectives, Mubadala structures its investments to create centres of excellence for data-driven innovation.
Mubadala’s strategic focus on industrial growth is driven by its commitment to creating investment opportunities to develop highly efficient economic clusters around regional centres of excellence. Through its diverse portfolio of investments, Mubadala seeks to drive capability, efficiency and innovation within these sectors while creating employment opportunities for Emiratis and enhancing their contribution to the broader society.
Mubadala is a major shareholder in GlobalFoundries, the world’s leading semiconductor contract manufacturer. Through this partnership, GlobalFoundries has built a manufacturing hub in Abu Dhabi that represents one of Mubadala’s most significant initiatives. This development complements Mubadala’s other initiatives in technology including Aseven JV (AI), Ibdaa (block chain applications) and investment assets such as Lens Technology Group China which have ventures with Automotive technologies including Lyft AV and FinTech like Avanti Financial Group USA amongst others.
GlobalFoundries and Mubadala
Mubadala Investment Company, an Abu Dhabi-based sovereign wealth fund, is a major stakeholder in GlobalFoundries, a U.S.-based semiconductor business. In addition, Mubadala recently announced that the company had raised $2.6 billion in a U.S. initial public offering.
This impressive IPO for GlobalFoundries was backed by Mubadala, and will be used to finance the company’s growth strategies.
Let’s take a closer look at Mubadala’s role in this success.
GlobalFoundries Overview
GlobalFoundries is a major semiconductor foundry company, founded in 2009, with headquarters in Santa Clara, California. The initial acquisition was an interest purchase from AMD of Chartered Semiconductor based in Singapore. GlobalFoundries continues to focus on developing and fabricating leading-edge integrated circuit technologies for the electronics industry. GlobalFoundries is one of the world’s largest semiconductor foundries, with a sizable market share across 22 countries worldwide.
The company is owned by the Abu Dhabi-based finance firm Mubadala Investment Company, which holds over 50 percent ownership of GlobalFoundries. Mubadala began its relationship with AMD through an agreement between AMD and ATIC (Advanced Technology Investment Company) before establishing GlobalFoundries.
Mubadala’s involvement as an investor has been instrumental in creating a strong and financially sound organisation for GlobalFoundries, establishing it as a major player in the semiconductor industry since its inception. In addition to creating large cost savings directly related to the acquisition process (such as tooling costs), Mubadala also provides ongoing financial investment and strategic advice from its board member representatives to ensure successful growth for GlobalFoundries for years to come.
Mubadala’s Investment in GlobalFoundries
In 2009, Mubadala Development Company, an Abu Dhabi-based investment company, invested in GlobalFoundries to form GF. Since this time, the two partners have been integral to the growth of GF’s specialty microchip manufacturing business. Mubadala accelerated growth in multiple areas by leveraging its existing relationships and resources across the Middle East and North Africa (MENA). Additionally, it provided capital for capacity expansion and operational investments that positioned GF as a leader in complex semiconductor technology manufacturing.
GF quickly established itself as a world-class supplier through its commitment to quality and core fabrication technologies. In addition, because of the partnership structure between Mubadala and GF, they could be quickly mobilised when the company needed additional funds. At the same time, costs were borne by one or more entities within their broader group versus traditional debt financing or venture capital scenarios. This flexibility offered increased cost savings while reducing risks associated with long-term debt financing during times when flexibility was essential.
By 2014, GF became one of only two leading chip manufacturers worldwide certified for high-volume production at 25 nanometer (nm) process nodes enabling clients to bring 14 nm devices to market faster than ever. In total, Mubadala had invested around US$7 billion into the company. In March 2015 AMD announced that it had fully repaid all of its debts to Mubadala Development Company and now held a majority stake in GF in addition existing shareholders including A&E Investment Co., Wafra Investment Advisory Group Inc., Temasek Holdings Pte Ltd., ATIC Corp., Letona Expansions amongst other investors involved at various stages since 2009.
Mubadala-backed GlobalFoundries raises $2.6bn in US IPO
On December 10, 2020, Mubadala-backed GlobalFoundries announced the listing of its American Depositary Shares (ADSs) on Nasdaq. GlobalFoundries raised $2.6 billion in the US Initial Public Offering (IPO) offering, making it the world’s biggest tech IPO of 2020. This was an important move for the company as it looks to expand operations worldwide.
Let’s take a deeper look into the role of Mubadala in the IPO of GlobalFoundries.
Overview of the US IPO
The public offering of GlobalFoundries Inc. (GF) is taking place in the United States in 2020. GlobalFoundries, a manufacturer of microchips, is majority-owned by the Abu Dhabi-based intergovernmental investment firm, Mubadala Investment Company (Mubadala). Upon completion of its planned Initial Public Offering (IPO) on the Nasdaq Stock Exchange, GlobalFoundries will become the first-ever major semiconductor company to list on a US stock exchange.
The IPO marks an unprecedented milestone for GF and Mubadala, highlighting their commitment to innovating and delivering high-quality manufacturing solutions for customers worldwide. By launching its IPO, GlobalFoundries plans to expand market opportunity for its existing products and services while at the same time forging new partnership opportunities in emerging industries – such as Internet of Things (IoT), connected devices and artificial intelligence (AI).
In addition to raising capital to fuel further growth and expansion initiatives, GF’s listing on the public markets will make it an appealing acquisition target for strategic buyers with substantial financial resources such as large technology companies or investors. Furthermore, publicly listed would afford GF additional advantages when securing financing or pursuing other financial objectives. Ultimately, a successful IPO would give GF more control over its operations while opening up earlier exits or monetization opportunities to shareholders at higher valuations than private investments.
Mubadala’s Role in the US IPO
Mubadala Investment Company, an Abu Dhabi-based sovereign wealth fund, is the majority shareholder in GlobalFoundries, the world’s third-largest semiconductor manufacturer. Mubadala is actively involved in GlobalFoundries’ US initial public offering (IPO), which will occur this month. The fund has reportedly injected $15 million into the chip maker in the weeks leading up to the IPO.
In addition to providing financial support for GlobalFoundries, Mubadala also holds a 41 percent stake in the firm through its venture capital arm, Millennium Pacific Group (MPG). The Abu Dhabi based venture capital investor has participated in several of GlobalFoundries’ significant financing rounds over its nine year history, such as Schain Capital Partners’ $6 billion equity investment in 2009 and Atairos Group’s $340 million investment last year. Mubadala also maintains direct ownership of two of GlobalFoundries’ major Abu Dhabi and Singapore facilities via partnerships with MPG and institutional investors such as Kuwait Investment Authority, International Petroleum Investment Company (IPIC) and Temasek Holdings.
Mubadala’s involvement with GlobalFoundries extends beyond just investments. Through its regulatory authority acquired during December 2015 after successfully acquiring a long-term controlling interest (LTCC) in AMD, it supported and steered GobalFoudnires initiatives such as reviving ailing node manufacturing operations at its Dresden facility by acquiring employees from former rival Global Foundry TA Semiconductor LTD., an Intel foundry services company initially acquired by Globalfoundry before ceasing operations due to declining demand for device production at 10 nanometer nodes. Further support was provided when last year Mubadalla allocated half of AMD transaction proceeds towards additional equities investments by MPG into GlobalFoundries facilities globally. With these investments made over the past five years totaling up to US$2 billion under various capacities including royalty payments & equity dividend generating growth rates near 23 percent on year-on-year average since 2011 due to increased demand for Globalfoundry chip production services across mobile computing & Internet of Things tech domains.
The monies earned are pivotal towards driving innovation & acquiring intellectual property that continuously pushes GobalFoudnires products portfolio forward via R&D funding available now with ongoing US IPO share sale scheduled this month that will invest proceeds for future development plans & diversifying demands within shifting markets globally that benefits all stakeholders significantly by late 2017 reportable date YTD results forecast estimates post listing this decade finally allowing open market access publicly via ADS securities listed currently on macro tier 3 NASDAQ index.
