IBM and GlobalFoundries announced that IBM will pay $1.5 billion to sell its semiconductor manufacturing facilities in East Fishkill and Vermont -- and GlobalFoundries will retain IBM's New York jobs. Some of the positions will stay with IBM.

The companies and state officials said the deal would mean billions of dollars of investment in New York along the Hudson River corridor that could also impact IBM and nanotech projects across the state.

New York has about 14,000 IBM employees; about half in Dutchess County. IBM also has facilities in Endicott, Broome County, where it was founded, with about 700 workers.

"I think up and down the Hudson Valley, from Yorktown, through Fishkill, through Poughkeepsie, through Albany, up into Malta, this is great news for employment in New York state," IBM vice president John Kelly told reporters during a conference call.

The Armonk, Westchester County-based IBM said a majority of its $3 billion investment in new chip research will be done in Yorktown, Westchester County, where IBM jobs will remain, and in Albany.

"This was the best possible outcome that preserves New York jobs and ensures that obligations made to the state are kept," Gov. Andrew Cuomo said in a statement. "GlobalFoundries and IBM are both world-class companies, and I look forward working with them to continue New York's rich legacy of innovation."

The companies have been negotiating the deal for about a year, and New York officials had a seat at the table. The final deal was reached Saturday.

The companies have had a working relationship since 2009 because they are heavily vested in the College of Nanoscale Science and Engineering at SUNY Albany – the massive research hub that has spawned facilities along the state Thruway corridor in Buffalo, Rochester, Syracuse and Utica.

"This is not the case of two companies that met each other on Match.com," said Alain Kaloyeros, CEO of the college. "Those are two companies that the governor has been building the hub to house; they are two of our anchor tenants."

GlobalFoundries, which has a major chip plant in Malta, Saratoga County, said it plans to invest $10 billion over the next year in its facilities, mainly in New York.

It vowed to keep open the IBM plants in East Fishkill, Dutchess County, and Essex Junction, near Burlington, Vt.

"We plan to offer substantially all of the employees at East Fishkill and Burlington, Vt., a job at GlobalFoundries, and we have no plans for layoffs or plans for shutting the plants down in any way," Sanjay Jha, GlobalFoundries CEO, said in the conference call with reporters.

But he added, "Of course, fabs have to stay competitive over the long term, but that is our commitment."

Therein lies the rub, some local development officials said. The concern is that GlobalFoundries may ultimately shift the jobs and the work to Malta, where it has the $8 billion plant and wants to hire hundreds of workers.

In February, IBM and Cuomo reached a deal to maintain 3,100 high-tech jobs in the Hudson Valley and surrounding areas through 2016. The deal was part of IBM's expansion in Buffalo to create 500 jobs at a $55 million high-tech hub.

"It's basically a two-year reprieve," Larry Gottlieb, CEO of Hudson Valley Economic Development Corp. said of Monday's deal. "In that time frame, you hope GlobalFoundries will see value in reinvesting some of those IBM dollars back into East Fishkill. And simultaneously you also want the community at large to strategize a future for the site if they don't."

The companies said there are no plans to scale down the current IBM facilities, and the new agreement doesn't come with an end date for the jobs.

Kaloyeros said the East Fishkill plant would be viable for GlobalFoundries for a decade or more because it produces a whole set of different products than what GlobalFoundries is doing in Malta.

GlobalFoundries spokesman Travis Bullard said that some workers may be offered positions in Malta, but "the vast majority of positions will remain focused on current technology programs at the existing IBM semiconductor manufacturing operations and facilities in East Fishkill and Essex Junction."

The deal still requires a variety of regulatory approvals. GlobalFoundries expects the deal to close sometime next year.

New York has had extraordinary leverage with IBM and GlobalFoundries, and the state has been looking to retain IBM jobs in any sale.

IBM is a top investor in a $4.4 billion deal in 2011 to expand research and development in New York, mainly at the nanocenter in Albany. New York owns the equipment and facilities in Albany, giving the state sway with the companies.

IBM expects to pay cash of $1.5 billion to GlobalFoundries over three years. It also includes $200 million of working capital, bringing the deal to $1.3 billion.

Because of the close relationships between the companies and New York, Kaloyeros hinted that the sides aren't done with their collaborations.

"As the governor said, this is not the end of the story. This is one chapter in many exciting chapters to come," Kaloyeros said.

JSPECTOR@Gannett.com

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