SkyWater Completes Strategic Acquisition of Fab 25, Strengthening U.S. Semiconductor Manufacturing Capacity and National Supply Chain Resilience
SkyWater Technology (Nasdaq: SKYT), a leading U.S.-based pure-play semiconductor foundry and trusted technology realization partner, has officially completed the acquisition of Infineon Technologies AG’s 200 mm semiconductor fabrication facility located in Austin, Texas—known as “Fab 25.” This transformative milestone significantly scales SkyWater’s domestic foundry capabilities, advancing its mission to support secure, high-demand semiconductor production for critical industries including defense, automotive, industrial, and infrastructure.
The transaction marks a critical inflection point not just for SkyWater but for the U.S. semiconductor ecosystem as a whole. By converting Fab 25 from a captive integrated device manufacturer (IDM) operation into an open-access, pure-play foundry, SkyWater is making a bold move to revitalize domestic chipmaking capacity and promote the reindustrialization of foundational technologies on American soil.
A New Chapter in American Chip Manufacturing
SkyWater’s acquisition of Fab 25 is more than an expansion—it’s a strategic realignment of the U.S. semiconductor supply chain to meet modern geopolitical, economic, and technological imperatives. By acquiring and retooling a fully operational 200 mm fab with an existing annual wafer capacity of approximately 400,000 starts, SkyWater gains the scale necessary to address mounting customer demand and rising national security concerns. This transition also empowers SkyWater to offer enhanced Advanced Technology Services (ATS), while integrating Fab 25’s proven technology infrastructure—such as 65 nm node process capabilities, copper metallization, and high-voltage processing.
The importance of domestically controlled semiconductor capacity has surged in recent years due to ongoing global chip shortages, international supply chain disruptions, and the growing recognition of semiconductors as a strategic asset. The transformation of Fab 25 directly addresses these concerns, positioning SkyWater as the largest exclusively U.S.-based pure-play foundry to offer dual-sourced, 200 mm node capacity for mission-critical applications.
Enabling Open-Access Manufacturing for High-Demand Technologies
With the acquisition finalized, Fab 25 now joins SkyWater’s secure, U.S.-only foundry platform that supports manufacturing innovation in embedded processors, microcontrollers (MCUs), memory, RF, mixed signal, and power devices—technologies fundamental to defense systems, transportation infrastructure, communications networks, and next-generation industrial systems.
“Today’s successful completion of the Fab 25 acquisition marks a pivotal moment in our ongoing effort to strengthen the U.S. semiconductor ecosystem,” said Thomas Sonderman, President and CEO of SkyWater. “By transforming Fab 25 into an open-access, scalable foundry, we’re building on its impressive legacy while opening a new chapter that advances supply chain resilience, expands opportunities for our customers, and enhances U.S. competitiveness in the technologies critical to industrial infrastructure, defense systems, and the transportation and auto industries.”
The move reflects SkyWater’s continued role as a champion of secure semiconductor manufacturing infrastructure. It’s one of the few companies actively repurposing domestic IDM facilities into open-access foundries—an initiative that aligns closely with U.S. Department of Defense (DoD) mandates for supply chain integrity, technology sovereignty, and operational transparency.
Driving National Onshoring and Economic Competitiveness
SkyWater’s conversion of Fab 25 adds substantial momentum to the broader national effort to onshore semiconductor production, particularly for older but essential process nodes that remain vital to global infrastructure. While much of the global conversation around semiconductors focuses on bleeding-edge technology, foundational chips built on mature nodes like 65 nm, 90 nm, and 130 nm remain critical for devices used in defense, aerospace, energy systems, and industrial automation.
The Fab 25 site—now retooled as part of SkyWater’s national network—fills a strategic void in the U.S. semiconductor ecosystem. Its existing capabilities and equipment, combined with the company’s forward-looking foundry roadmap, allow SkyWater to increase capacity, diversify supply chains, and reduce reliance on foreign manufacturing.
Moreover, this acquisition reflects the practical application of recent federal initiatives such as the CHIPS and Science Act, which aims to restore American semiconductor leadership and create resilient infrastructure for the next generation of innovation. SkyWater’s effort to transform captive fabs into open-access hubs closely mirrors the legislation’s goals.
Long-Term Partnership with Infineon Secures Continuity and Flexibility
As part of the deal, SkyWater and Infineon have entered into a long-term wafer supply agreement that allows Infineon to continue leveraging the Austin facility’s production capacity while focusing on other global investments. The agreement provides Infineon with manufacturing stability and geographic diversity, ensuring an efficient, scalable footprint in the United States.
This arrangement is mutually beneficial: it allows Infineon to maintain continuity with key U.S. customers while enabling SkyWater to quickly utilize the site’s installed capacity and existing team without a lengthy ramp-up period. This ensures that critical semiconductor production will continue uninterrupted during the transition and supports rapid expansion of service offerings to new and existing SkyWater clients.
A Skilled Workforce and Local Economic Impact
SkyWater’s acquisition also has strong implications for the regional economy and semiconductor workforce development in Texas. As part of the transition, approximately 1,000 Fab 25 employees are now part of the SkyWater team, bringing decades of process knowledge, operations expertise, and industry leadership to the company.
The Austin facility will remain a vibrant center of semiconductor innovation and production. SkyWater has committed to ongoing investment in workforce training, infrastructure modernization, and community partnerships to support long-term growth. The company views the Austin region not only as a manufacturing hub but as a strategic partner in strengthening America’s semiconductor future.
Expanding the Foundry Footprint: A Multi-Node, Multi-Market Platform
The addition of Fab 25 further diversifies and strengthens SkyWater’s domestic foundry platform. SkyWater’s foundry roadmap now includes expanded support for 200 mm manufacturing at foundational nodes, which complements its capabilities at other facilities—such as its headquarters in Bloomington, Minnesota, and its advanced packaging and R&D centers.
Fab 25’s integration into this network enables SkyWater to serve a broader range of industries with enhanced efficiency, redundancy, and scalability. With customers increasingly seeking resilient supply chains and regional manufacturing partners, SkyWater’s expanded footprint offers the flexibility to meet complex technical requirements while mitigating geopolitical risks.
The company’s multi-node capabilities will also be essential as it pursues new ATS projects and government contracts. SkyWater is already a trusted partner to U.S. government agencies such as the Department of Defense and Department of Energy. With Fab 25 online, the company is positioned to expand those relationships and accelerate new technology development in quantum computing, space electronics, and secure communications.
Financial Structure and Strategic Investment
The financial structure of the Fab 25 transaction demonstrates both SkyWater’s disciplined approach to strategic investment and its long-term growth vision. The total purchase includes a $73 million payment at closing, plus approximately $20 million for working capital, subject to post-close adjustment. Notably, SkyWater modified the original terms announced on February 26, 2025, by increasing the upfront consideration by $18 million and eliminating a $25 million deferred payment tied to the supply agreement.
The acquisition is expected to deliver meaningful revenue growth, improved adjusted EBITDA, and positive free cash flow generation. These financial benefits will position SkyWater for future capital investment and R&D expansion while enhancing shareholder value.
To support the transaction and ensure financial flexibility, secured a new five-year, senior secured revolving credit facility of up to $350 million from a syndicate of lending partners, including Siena Lending Group LLC, Great Rock Capital, Benefit Street Partners, and Ares Credit Group. This facility replaces previous $130 million revolving credit line and is structured to fund not only the Fab 25 acquisition but also working capital needs, capital expenditures, and other corporate initiatives.
As of the transaction’s close, SkyWater drew $137 million from the facility. Of that, approximately $103 million was allocated to acquisition-related costs (including the Infineon payment and transaction expenses), while $26 million replaced the draw on the previous revolving credit facility. The remaining $7 million was added to cash reserves.
TD Securities served as exclusive financial advisor for the debt financing, providing key insights to structure the deal in a way that supports both near-term integration and long-term growth goals.
SkyWater plans to host a Capital Markets Day event at Fab 25 during the second half of fiscal 2025, where company leadership will provide further insights into the strategic value of the acquisition, integration progress, financial performance expectations, and customer engagement opportunities. The event will highlight the company’s long-term commitment to advancing U.S. semiconductor independence and detail how Fab 25 will play a central role in that vision.
SkyWater encourages prospective customers, investors, and partners interested in collaborating at Fab 25 to connect via the company’s contact portal: SkyWater Contact Form.
A Foundational Leap Forward for SkyWater and U.S. Semiconductor Strategy
With the acquisition and conversion of Fab 25, Technology has firmly established itself as a cornerstone of the domestic semiconductor industry. This move bolsters not only the company’s capacity and capabilities but also the broader national push toward resilient, secure, and advanced manufacturing infrastructure.
By transforming an existing IDM facility into a high-volume, open-access foundry, is helping to restore the U.S. semiconductor base—one wafer at a time—and delivering on a strategic vision that aligns technological innovation with national priorities.
About SkyWater
SkyWater (NASDAQ: SKYT) is a U.S.-based semiconductor manufacturer and a DMEA-accredited Category 1A Trusted Supplier. Technology as a Service model streamlines the path to production for customers with development services, high-volume production and heterogeneous integration solutions in its U.S. facilities. This pioneering model enables innovators to co-create the next wave of technology within diverse categories including mixed-signal CMOS, read-out ICs, rad-hard ICs, MEMS, superconducting ICs, photonics and advanced packaging. serves critical domestic markets including aerospace & defense, automotive, biomedical, industrial and quantum computing. For more information, visit: www.skywatertechnology.com.
