AMD breaks ground on new chip factory

The Global Foundries facility will produce chips for AMD and third-party chipmakers

AMD is preparing the construction of a $4.2bn (£2.5bn) facility in upstate New York which will house its Global Foundries spin-off.

The plant will house offices and manufacturing operations for Global Foundries, the company spun off from AMD last year with the help of the Advanced Technology Investment Company of Abu Dhabi.

The move was part of a plan by AMD to erase some of its debt, and shift its focus to chip design in the wake of disappointing first-quarter and second-quarter results.

On its completion in 2012, the company estimates that the new Fab 2 plant will create some 6,400 jobs. The facility will produce new chips for AMD as well as third-party chipmakers.

"Fab 2 represents the culmination of AMD's multi-year vision to bring a leading-edge semiconductor manufacturing facility to the US," said AMD president and chief executive Dirk Meyer.

"Global Foundries is expected to be an ideal technology partner for the entire semiconductor design industry, providing cost-effective access to manufacturing capacity on an unprecedented scale."