Fairstock HK Limited: STMicro and GlobalFoundries Set to Announce French Chip Factory

GlobalFoundries Inc. and STMicroelectronics NV will announce plans to build a semiconductor factory in France next week with the help of government funds, people familiar with the matter said. 

The announcement will be part of French President Emmanuel Macron’s push to attract foreign investors during a Choose France summit on Monday and a trip to Grenoble on Tuesday, the people said, asking not to be identified because the plans are still private. Bloomberg reported in June that the two companies were in talks about the factory.

A GlobalFoundries spokesperson declined to comment. A representative for STMicro didn’t immediately respond to a request for comment. Macron’s office didn’t immediately respond to a request for comment. 

The project from the two companies will be the second foundry announcement under the European Union’s Chips Act -- a 43 billion euro ($43.8 billion) plan to subsidize first-of-a-kind semiconductor production in Europe. The Commission wants to produce 20% of the world’s chips by 2030 to build up domestic production and help alleviate supply chain constraints. 

The vast majority of the money to bolster chip production will come from EU countries, which could make billions available in state subsidies. EU countries will also help finance more than 100 smaller chip projects under the Important Projects of Common European Interest program.

In March, Intel Corp. announced plans to build a massive foundry to make cutting-edge chips in Magdeburg, Germany, as well as other investments throughout Europe. Taiwan Semiconductor Manufacturing Company has also been in talks with Germany to build a site in the country.