Biden-Harris Administration Announces Preliminary Terms with Absolics to Support Development of Glass Substrate Technology for Semiconductor Advanced Packaging

Proposed CHIPS Investment Would Support Construction of New Manufacturing Facility and Over 1,200 Jobs in Covington, Georgia

May 24, 2024 -- Today, the Biden-Harris Administration announced that the U.S. Department of Commerce and Absolics, an affiliate of the Korea-based SKC, have signed a non-binding preliminary memorandum of terms (PMT) to provide up to $75 million in direct funding under the CHIPS and Science Act to help advance U.S. technology leadership. The proposed CHIPS investment would support the construction of a 120,000 square-foot facility in Covington, Georgia and the development of substrates technology for use in semiconductor advanced packaging. The proposed investment with Absolics is the first proposed CHIPS investment in a commercial facility supporting the semiconductor supply chain by manufacturing a new advanced material.

“An important part of the success of President Biden’s CHIPS program is ensuring the United States is a global leader in every part of the semiconductor supply chain, and the advanced semiconductor packaging technologies Absolics is working on will help to achieve that goal, while also creating hundreds of jobs in Georgia,” said U.S. Secretary of Commerce Gina Raimondo. “Through this proposed investment in Absolics, the Biden-Harris Administration is helping accelerate innovation, advance U.S. technological leadership in semiconductor manufacturing, and generate economic opportunity in the Atlanta area and throughout the state.” 

Because of President Biden’s CHIPS and Science Act, this proposed investment would support over an estimated 1,000 construction jobs and approximately 200 manufacturing and R&D jobs in Covington and enhance innovation capacity at Georgia Institute of Technology (Georgia Tech), supporting the local semiconductor talent pipeline. Started through a collaboration with the 3D Packaging Research Center at Georgia Tech, Absolics’ project serves as an example of American lab-to-fab development and production.

“Since Day One of this Administration, President Biden has committed to growing the economy from the middle-out and bottom-up,” said Chief Economist of the Investing in America Cabinet Heather Boushey. “He passed historic legislation to invest in America – the American Rescue Plan, the Bipartisan Infrastructure Law, the Inflation Reduction Act, and the CHIPS and Science Act – rebuilding our infrastructure, lowering costs, and creating opportunities for families, workers, and businesses. This new agreement with Absolics is going to help us meet the demand for the technology of tomorrow while supporting good-paying jobs in Georgia today.”

Absolics glass substrates will be used as an important advanced packaging technology to increase the performance of leading-edge chips for AI, high-performance compute and data centers by reducing power consumption and system complexity. The glass substrates produced by Absolics enable smaller, more densely packed, and shorter length connections resulting in faster and more energy efficient computing. Currently, the advanced packaging substrates market is concentrated in Asia, and, because of this proposed CHIPS investment, U.S.-based companies would have an expanded domestic supply of glass substrates for advanced packaging.

Advanced packaging is an essential component for U.S. companies to improve semiconductor applications. The path to advanced packaging starts with substrates, which are the foundations on which systems are built. More capable substrates open the door to innovation at every other level in the packaging process. The company will continue its R&D work with Georgia Tech, while also collaborating on projects related to the Department of Defense’s “State-of-the-Art" Heterogeneous Integrated Packaging (SHIP) program in RF technologies. Absolics commitment to working with and developing local talent also includes a partnership with Georgia Piedmont Technical College to provide work-ready education and hands-on skill training.

“Creating a broad-based advanced packaging ecosystem is crucial to the success of revitalizing the U.S. semiconductor industry and this all begins with substrates,” said Under Secretary of Commerce for Standards and Technology and National Institute of Standards and Technology Director Laurie Locascio. “Supporting innovation of the substrate can improve performance and reduce power needs in advanced packaging technologies which are critical to the needs of artificial intelligence capabilities and high-performance compute.”

“With the support of this proposed CHIPS funding, Absolics would be able to fully commercialize our pioneering glass substrate technology for use in high-performance computing and cutting-edge defense applications. This effort is an important component of establishing a robust semiconductor advanced packaging ecosystem in the State of Georgia and restoring the U.S.’s leadership in semiconductor industry. Our new facility in Covington will not only enhance our ability to produce high-quality glass substrates but also create high-skilled jobs and drive innovation through our partnership with Georgia Tech,” said Absolics CEO Jun Rok Oh. “Absolics is proud to contribute to the resilience and competitiveness of the American semiconductor industry.”

As explained in its first Notice of Funding Opportunity, the Department may offer applicants a PMT on a non-binding basis after satisfactory completion of the merit review of a full application. The PMT outlines key terms for a potential CHIPS incentives award, including the amount and form of the award. The award amounts are subject to due diligence and negotiation of award documents and are conditional on the achievement of certain milestones. After the PMT is signed, the Department begins a comprehensive due diligence process on the proposed projects and continues negotiating or refining certain terms with the applicant. The terms contained in any final award documents may differ from the terms of the PMT being announced today. 

About CHIPS for America

The Department has received more than 660 statements of interest, more than 220 pre-applications and full applications for NOFO 1, and more than 160 small supplier concept plans for NOFO 2. The Department is continuing to conduct rigorous evaluation of applications to determine which projects will advance U.S. national and economic security, attract more private capital, and deliver other economic benefits to the country. The announcement with Absolics is the ninth PMT announcement the Department of Commerce has made under the CHIPS and Science Act, with additional PMT announcements expected to follow throughout 2024.

CHIPS for America is part of President Biden’s economic plan to invest in America, stimulate private sector investment, create good-paying jobs, make more in the United States, and revitalize communities left behind. CHIPS for America includes the CHIPS Program Office, responsible for manufacturing incentives, and the CHIPS Research and Development Office, responsible for R&D programs, that both sit within the National Institute of Standards and Technology (NIST) at the Department of Commerce. NIST promotes U.S. innovation and industrial competitiveness by advancing measurement science, standards, and technology in ways that enhance economic security and improve our quality of life. NIST is uniquely positioned to successfully administer the CHIPS for America program because of the bureau’s strong relationships with U.S. industries, its deep understanding of the semiconductor ecosystem, and its reputation as fair and trusted. Visit https://www.chips.gov to learn more.