The agreement, part of an amendment to the commercial Wafer Supply Agreement (WSA) with AMD, positions GLOBALFOUNDRIES as a pure-play semiconductor foundry company with AMD as one of its primary and strategic customers. GLOBALFOUNDRIES will now be wholly owned by the Advanced Technology Investment Company (ATIC).
The new deal will no longer require AMD to make its chips exclusively at Global Foundries. AMD will make a payment of $425 million to GlobalFoundries to waive off the exclusivity deal, incurring a related charge of $703 million in the first-quarter.
The companies also signed a new supply agreement, which waives certain quarterly payments that AMD was to make to GlobalFoundries this year as part of the 2012 wafer supply agreement.
AMD had seen production issues at GlobalFoundries affect output last year.
"Today marks the start of a new era for GLOBALFOUNDRIES as it becomes a truly independent foundry," said GLOBALFOUNDRIES CEO Ajit Manocha. "GLOBALFOUNDRIES has a clear vision to be the leading semiconductor foundry partner to AMD and one of the world's top technology companies. We continue to execute on our strategy to propel ATIC's long-term investment philosophy into true value creation for our shareholder and customers."
When AMD originally spun off its foundry business in 2008, the resulting Foundry Company was 55.6% ATIC owned and 44.4% AMD owned.
GLOBALFOUNDRIES has operations in Singapore, Germany and the United States, with three 300mm and five 200mm fabs. In January, the company announced plans for more than $3 billion in capital spending in 2012 to fund expansion of its facilities in Singapore, Germany and New York.
Also in January, the company announced that its newest 300mm manufacturing facility, Fab 8 in New York, started running the first silicon as part of a new customer agreement to develop chips for IBM.
The company also achieved several milestones in its longstanding partnership with ARM, including the first Cortex-A9 processor operating at more than 2.5GHz on 28nm high-performance technology, and the first 28nm ARM Cortex-A9 Processor Optimization Pack (POP) capable of up to 2GHz on a low-power process geared toward smartphones and other mobile application.