GlobalFoundries weighs merger with No. 2 Taiwan chipmaker UMC: sources

TAIPEI -- U.S. contract chipmaker GlobalFoundries and United Microelectronics Corp., Taiwan's No. 2 chipmaker, are exploring the possibility of a merger amid American efforts to mitigate risks surrounding the Taiwan Strait and fend off growing competition from China in mature chips, Nikkei Asia has learned.

In an assessment plan seen by Nikkei Asia, a tie-up of GlobalFoundries-UMC would create a bigger, U.S.-based company with a production footprint across Asia, the U.S. and Europe. The aim of the merger would be to create a company with the economic scale to ensure America has access to mature chips as tensions simmer between China and Taiwan and as China produces more chips on its own, according to the plan.