The Chengdu GlobalFoundries fab project, which has been stranded for five years, seems to have finally ushered in a taker—Shanghai Huali Microelectronics Co., Ltd. (hereinafter referred to as “Shanghai Huali”) under the Hua Hong Group.
According to reports, Shanghai Huali is about to take over the Chengdu GlobalFoundries 12-inch wafer fab that has been shut down for nearly five years.
It is worth noting that the recruitment announcement issued by Shanghai Huali’s official WeChat public account platform on the morning of the 20th shows that the recruitment involves seven categories of positions including R&D design, engineering technology, power environment safety, product quality, intelligent manufacturing, planning information, and comprehensive intelligence, and the working locations of the positions include Shanghai and Chengdu.
Shanghai is the headquarters of Shanghai Huali, but Shanghai Huali has no branch in Chengdu. This large-scale recruitment of positions in Chengdu also seems to confirm that Shanghai Huali will take over the unfinished Chengdu GlobalFoundries 12-inch fab project.
In the recruitment information, Shanghai Huali also wrote: “In July 2023, Hua Hong Group will usher in major milestones on the road to high-quality development one after another. With the upgrading of corporate strategy development, Shanghai Huali has embarked on a new journey. According to the current development needs, we sincerely invite talents from all over the world to share development opportunities and pursue their dreams!”
According to the data, on May 31, 2016, GlobalFoundries (then called GlobalFoundries) signed a memorandum of understanding on cooperation with Chongqing Municipality, intending to establish a joint venture with the Chongqing Municipal Government to build a new 12-inch wafer fab in China.
After that, the cooperation between the two parties broke down, and the partner was replaced by Chengdu.
In May 2017, GlobalFoundries announced the construction of a 12-inch wafer fab in Chengdu, with an estimated investment scale of more than US$10 billion, making it the first 12-inch wafer production line in southwestern mainland China.
The Chengdu fab is divided into two phases of construction. The first phase is a mature process (180nm/130nm), which is expected to be put into operation by the end of 2018. The second phase of construction is the 22FDX FD-SOI process, which is expected to be put into production in the fourth quarter of 2019.
Products are widely used in mobile terminals, Internet of Things, smart devices, automotive electronics and other fields.
In April 2018, GF invested 540 million yuan in Chengdu GF factory, and Chengdu Gaoxin Industrial Investment Co., Ltd. (hereinafter referred to as “Chengdu Gaoxin”) invested 520 million yuan, a total of more than 1.06 billion US dollars paid-in capital contribution.
However, for the follow-up investment, GlobalFoundries hopes to buy shares with the old equipment of the Singapore factory at a discount, but the Chengdu government hopes to start the second phase of the project, and does not agree with the proposal of buying old equipment.
In June 2018, GlobalFoundries began to lay off employees globally, and the recruitment of the Chengdu plant was suspended.
In August of the same year, GlobalFoundries announced that it would suspend the development of advanced manufacturing processes of 7nm and below.
In October 2018, GlobalFoundries announced that it had signed an amendment to the investment cooperation agreement with its Chengdu partners, canceling the investment in the Chengdu Fab Phase I mature process (180nm/130nm) project. This also means that the GF Chengdu project is officially stranded.
In February 2019, news came out in the industry that the GlobalFoundries Chengdu plant had been shut down and the internal equipment of the plant had been cleared. The requirement for employees to leave had changed from “need to return training fees” to “no need to return training fees”, as if encouraging employees to leave in disguise.
In April 2019, at the suggestion of Chengdu Gaoxin, the board of directors of Chengdu GlobalFoundries adopted a “temporary co-management mechanism” to be responsible for canceling orders and disposing of existing equipment and assets.
However, due to the great differences between the two parties on the asset disposal plan, on October 17, 2019, Chengdu GlobalFoundries canceled the temporary co-management mechanism.
In this regard, Chengdu Gaoxin also sued Chengdu GlobalFoundries, claiming that its unilateral cancellation of the temporary co-management mechanism violated the company’s articles of association.
In mid-May 2020, Chengdu GlobalFoundries issued three “Notices on Human Resource Optimization Policies and Suspension and Business Suspension”. In the notice, Chengdu GlobalFoundries stated, “In view of the company’s current operating status, the company will officially suspend work and cease business from the date of this notice.”
On June 4, 2020, the case of Chengdu Gaoxin suing Chengdu Globalfoundries was heard in court.
Chengdu Gaoxin pointed out in the trial that in the asset disposal plan of Chengdu GlobalFoundries, the compensation equipment amounted to more than 20 million US dollars, the equipment to be sold was more than 10 million US dollars, and the related transaction equipment also amounted to more than 30 million US dollars, including the remaining funds of 61 million US dollars, far exceeding the 40 million US dollars stipulated in the articles of association.
However, Chengdu GlobalFoundries stated that due to the large fluctuations in the value of semiconductor equipment, the amount of the equipment cannot be determined before the final disposal, so it is impossible to determine whether it will reach 40 million US dollars. In the end, the two parties agreed to mediate, but the results have not been made public.
It is understood that, In addition to the tens of millions of dollars worth of equipment on the table that needs to be disposed of in the unfinished Chengdu GF fab project, there is also a standard factory covering an area of 42 hectares that needs to be disposed of.
According to some statistics, Chengdu’s actual investment in the Chengdu GlobalFoundries Fab has reached 6.93 billion yuan. How to revitalize the project assets of the unfinished Chengdu GF fab project has become a headache for Chengdu in recent years.
In September 2020, there were rumors that Chengdu Gaozhen Technology Co., Ltd. (hereinafter referred to as “Gaozhen Technology”) will take over the Chengdu GlobalFoundries Fab and switch to producing DRAM memory chips on this basis. But then it seems to be gone.
On April 8, 2022, GlobalFoundries (Chengdu) Integrated Circuit Manufacturing Co., Ltd. changed its name to Chengdu Plus Core Technology Co., Ltd. (hereinafter referred to as “Chengdu Plus Core”).
Subsequently, on August 11, 2022, Chengdu Gaoxin Industrial Investment Co., Ltd., which originally held 49% of the shares in Chengdu Jiaxin, withdrew from Chengdu Jiaxin, and GF ASIA INVESTMENTS PTE.LTD., a subsidiary of GlobalFoundries, became a 100% controlling shareholder.
At that time, the “shell” of Chengdu Jiaxin may be abandoned, and if the unfinished Chengdu GlobalFoundries fab needs to be replaced and continue to be built, it may need to be incorporated into a new company.
In February 2023, there were market rumors that Tsinghua Unigroup may take over Chengdu GlobalFoundries’ unfinished fab. As a condition, Chengdu agreed to invest in Tsinghua Unigroup.
But in the end it’s just a rumor.
The investment of nearly 7 billion Chengdu GF fab has been unfinished for 5 years: Shanghai Huali wants to take over? -Fast technology-Technology changes the future - GAMINGDEPUTY
The Chengdu GlobalFoundries fab project, which has been stranded for five years,
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