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While TSMC makes strides in cutting-edge nodes and aims for 2nm mass production by year-end, its Taiwanese foundry counterpart, UMC, is rumored to be exploring a potential merger with U.S.-based GlobalFoundries, as per Nikkei and Reuters.
However, the speculation has been denied by UMC, as it states that there is currently no merger in progress, according to local media Liberty Times and the Economic Daily News.
Nikkei and Reuters report that a UMC-GlobalFoundries merger would form a larger U.S.-based chipmaker with a global presence across Asia, the U.S., and Europe. The rumored talks come as the U.S. aims to strengthen its semiconductor supply chain amid Taiwan Strait tensions and rising Chinese competition in mature chips.
Founded in 1980, UMC was Taiwan’s first publicly listed semiconductor company, predating TSMC, according to the Economic Daily News. In 2017, it announced its decision to exit the sub-12nm race after falling behind at 18nm, further widening its technology gap with TSMC.
More Possibilities?
Interestingly enough, the Liberty Times report notes that rumors of a UMC-GlobalFoundries merger used to surface two years ago but never progressed. Since both firms focus on mature nodes, a merger would only expand scale without adding synergy or boosting competitiveness, the report indicates.
On the other hand, industry sourced cited by the report points out that if UMC were to merge, Intel would be a stronger match. As Intel brings deep technical expertise, UMC has practical foundry experience, making for a more competitive combination, the report says.
A couple of months ago, UMC clarified that it has no intention to build a plant in the U.S. currently, as per Central News Agency. UMC’s focus in the U.S. is primarily on its collaboration with Intel, as the two jointly announced in 2024 that they will collaborate on the development of a 12nm process platform to address high-growth markets such as mobile, communication infrastructure and networking.
According to TrendForce, TSMC held a dominant 67% market share in Q4 2024, maintaining its lead in the foundry market. UMC and GlobalFoundries ranked 4th and 5th, with 4.7% and 4.6% shares respectively, trailing behind Samsung (8.1%) and China’s SMIC (5.5%).
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(Photo credit: UMC)
