GlobalFoundries has secured a major contract with the Pentagon.

The Pentagon has agreed to a seven-year contract with GlobalFoundries to supply microchips for U.S. spy satellites, missiles and combat jets, according to the Wall Street Journal.

This contract is a big win for GlobalFoundries and the Northeast Tech Corridor, which includes the East Fishkill and Burlington, Vermont, plants that make the chips.

Previously, IBM had been the main provider of the chips to the Pentagon for more than a decade. However, GlobalFoundries took over the chip business in 2015.

The deal is also good news for the government because it secures their supply chain and allows these chips to continue to be made in the United States.

The agreement runs until 2023. Terms of the deal were not disclosed, according to the Wall Street Journal.

GlobalFoundries, which is owned by Abu Dhabi, is one of the fourth largest chip manufacturers in the world.

In a statement to the Journal Tuesday, GlobalFoundries said, "We understand that the U.S. Government is in the process of reassessing the means through which it sources semiconductors, and GlobalFoundries has recently been part of the industry dialog on new alternative approaches to semiconductor procurement. We expect to continue to be a part of this conversation as we believe the new combined company can offer a lot of value beyond what IBM was able to do on its own."

GlobalFoundries typically does not comment on its contracts with government agencies. However, it has said that its location in East Fishkill is key to its overall strategy to becoming the world's leaders in the competitive chip manufacturing business.

Global Foundries, which obtained IBM’s semiconductor plant in East Fishkill had 1,780 employees as of November. That number does not include contracted workers from IBM and other companies.

Recently the company received the Trusted Foundry accreditation, which means we meet the level of protection that IBM had in the past, the company said.

"We have taken a number of important steps to ensure the proper security protocols are in place," GlobalFoundries officials said in its statement. "The ownership transfer from IBM to GlobalFoundries was scrutinized by the U.S. government during the CFIUS (The Committee on Foreign Investment in the United States) review process and we worked closely with the government to come up with an ownership structure that would maintain the proper safeguards, including the establishment of a separate U.S. based company with its own board of directors."

By: DocMemory
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