Chipmaker GlobalFoundries prices IPO at upper end to raise $3.5 billion: Sources
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The IPO gives GlobalFoundries a valuation of about US$26 billion, making it one of the biggest stock market flotations of the year in the United States.
PHOTO: GLOBALFOUNDRIES SINGAPORE
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BENGALURU (REUTERS) - GlobalFoundries, which has major semiconductor manufacturing operations in Singapore, has raised about US$2.6 billion (S$3.5 billion) in its initial public offering (IPO).
The company on Wednesday (Oct 27) sold shares in its IPO at US$47 a piece, the higher end of its targeted price range.
The IPO gives GlobalFoundries a valuation of about US$26 billion, making it one of the biggest stock market flotations of the year in the United States.
Abu Dhabi's sovereign wealth fund Mubadala Investment, which holds a majority stake in GlobalFoundries, sold 22 million shares in the IPO.
The company said in its prospectus that proceeds will be used for capital expenditure and general corporate purposes but that a portion may be used for acquisitions of investments in businesses or technologies that complement its business. However, it currently has no present commitments to do so.
Funds associated with BlackRock, Fidelity Management & Research Company, some affiliates of Koch Strategic Platforms, Columbia Management Investment Advisers and Qualcomm invested more than US$1 billion in the IPO.
A spokesman for GlobalFoundries said the company is waiting to finalise the details, and declined to comment on the IPO price.
The IPO comes at a time when demand for chips has skyrocketed due to a global shortage that has forced automakers and other electronics firms to cut production.
Strong demand for chips has boosted revenue at GlobalFoundries over the past 12 months and helped it cut back losses.
One of the marquee listings of 2021 - which included Coinbase Global, Robinhood Markets and Coupang - GlobalFoundries and electric vehicle maker Rivian are headlining a particularly busy year-end for US IPOs.
The company was created when Mubadala bought Advanced Micro Devices's manufacturing facilities in 2009 and later merged it with Singapore's Chartered Semiconductor Manufacturing.
In June, GlobalFoundries announced a new $5.4 billion plant in Singapore that will add 1,000 jobs to its 4,800 headcount here. Singapore accounts for about a third of GlobalFoundries' revenue.
The company said in its prospectus that the Singapore facility is one of the largest semiconductor foundry manufacturing sites in South-east Asia.
The firm, which makes radio-frequency communications chips for 5G, automotive, and other specialised semiconductors, counts AMD and Broadcom among its 200 customers worldwide.
GlobalFoundries is the world's third-largest foundry by revenue behind Taiwan Semiconductor Manufacturing Co and Samsung Electronics, but ranks second when factoring out Samsung's foundry business, which makes chips for other elements of the South Korean firm.
