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TSMC Stock Jumps on Biden’s $11.6 Billion Funding to Boost US Chip Manufacturing




TSMC Stock Jumps on Biden's $11.6 Billion Funding to Boost US Chip Manufacturing
  • TSMC shares rose on Monday after a nearly $12 billion deal with the US to boost chip production.

  • TSMC is expected to receive up to $6.6 billion in grants and $5 billion in direct funding under the CHIPS and Science Act.

  • TSMC’s $65 billion marks the largest foreign direct investment in Arizona and the largest greenfield project in U.S. history.

Shares of Taiwan Semiconductor Manufacturing Company rose as much as 3.2% on Monday as President Joe Biden’s administration approved nearly $12 billion in grants and loans for the world’s largest semiconductor company to boost U.S. manufacturing activity.

TSMC stock traded at an intraday high of $145.92 per share around 10:30 a.m. ET, bringing gains to about $143 shortly after 1 p.m.

The deal positions the Taiwanese chip company to receive as much as $6.6 billion in subsidies and $5 billion in direct financing from the Biden administration as part of the deal. CHIPS and Science Act that was adopted in 2022.

In a press releaseTSMC has unveiled plans for a third manufacturing facility at its planned Phoenix location by 2028 to meet rising semiconductor demand in the US. With an investment of more than $65 billion, the plan marks the largest foreign direct investment in Arizona and the largest greenfield project in U.S. history.

In a separate release on MondayAccording to the U.S. Department of Commerce, Arizona’s chip manufacturing facilities will power major tech companies such as AMD, Apple, Nvidia and Qualcomm.

Combined with the previous two plants that are on track to begin production, the three plants are expected to add 6,000 high-tech jobs and 20,000 construction jobs, the Commerce Department said.

“TSMC’s renewed commitment to the United States and its investment in Arizona represent a broader story for American-made semiconductor manufacturing with strong support from America’s leading technology companies to build the products we rely on every day” , President Biden said in the release.

The partnership with Taiwan’s largest chipmaker strengthens the US goal of producing 20% ​​of the world’s leading chips by 2030 and reducing dependence on China’s high-tech manufacturing as tensions rise between the superpowers.

Last Wednesday, a powerful 7.4 magnitude earthquake temporarily shook Taiwan’s east coast ceasing the activities of TMSC in some locations.

Read the original article Business insider