Quantcast

Report: IBM close to deal on chipmaking division - WCAX.COM Local Vermont News, Weather and Sports-

Report: IBM close to deal on chipmaking division

Posted: Updated:
ESSEX JUNCTION, Vt. -

A top online business magazine is reporting that IBM is nearing a deal to sell its chipmaking operations.

Sources close to the negotiations between Big Blue and GlobalFoundries tells Bloomberg that the two sides are close and a sale looks imminent.

"This is something that has been in talks for a year now and we have seen some of these IBM deals stick on price and what's included," said Alex Barinka from Bloomberg.

Bloomberg reports that GlobalFoundries, which has been the frontrunner to buy IBM's chipmaking, wants its engineers and intellectual property too, the patents and design.

"We know they are interested in the manufacturing side, but the lynch pin will be that intellectual property side and the engineers," said Barinka.

"Our primary concern, always, is the 4,000 Vermonters that work there," said Frank Cioffi from the Greater Burlington Industrial Development Corporation.

Frank Cioffi leads the GBIC, which advocates for economic development in the region. News that a sale may be coming, prompted GBIC to dig deep into Big Blue's economic impact in Vermont. Its study found IBM makes a $1 billion impact on the state's economy and fuels the financial well being of 10,000 families.

Cioffi says if a potential buyer is mainly interested in engineers and intellectual property, IBM's Essex Junction facility is still relevant and valuable.

"To build a facility and a fab like we have it's probably a $2 to $3 billion investment for anybody globally, so there is huge value in what we have here in physical assets, there's even greater value in what we have here in people," said Cioffi.

Barinka agrees and says GlobalFoundries might be a good fit, for now.

Reporter Darren Perron: Do you think they could shutter this plant?

Barinka: The thing to consider with that is to build a plant like this is very expensive, so it will be a cost benefit analysis for GlobalFoundries. If they have a need for these chips being manufactured there they might keep that location open until there's not a market demand for those specific products.

Barinka also says since IBM is looking to off load this plant, it might be the best scenario if GlobalFoundries buys it and keeps it going. Otherwise, it could get shuttered by Big Blue or another company.

In a statement, Gov. Peter Shumlin, D-Vermont, said, "I am closely following the press reports regarding IBM but cannot comment about their claims regarding these publicly traded companies, other than to say once again that the employees at IBM, their families and their communities are incredibly valuable to Vermont. I will do everything possible to work with IBM or any other company that were to come forward to ensure that these talented and hard-working individuals at the Essex facility continue to innovate there and contribute to the economic growth of our state."

Related Stories:

New numbers show what's at stake if IBM sells Vt. plant

Big buyer for Big Blue?

Is IBM's future in Vermont uncertain?

Report: GlobalFoundries in lead to buy IBM chip plants

Pink slips at Big Blue in Essex Jct.

Layoffs underway at IBM Essex Junction

Source: IBM Essex Jct. job cuts set for Thursday

Pink slips called off at IBM Essex Junction

Reports: IBM looking to sell chipmaking operations

Are big layoffs coming to Big Blue?
Powered by WorldNow
All content © Copyright 2000 - 2014 WorldNow and WCAX. All Rights Reserved. For more information on this site, please read our Privacy Policy and Terms of Service.