Singapore - A government-owned investment company from Abu Dhabi offered to buy loss-making Singapore chip-maker Chartered Semiconductor, the companies said on Monday, in a deal that would allow the new owner to compete with leading chipmakers from Taiwan.

Advanced Technology Investment Company LLC (Atic) of Abu Dhabi would pay 1.8 billion US dollars in cash for Chartered, the companies said in a joint statement.

The total value of the transaction, which was expected to close during the fourth quarter of 2009, would come to 3.9 billion US dollars, including debts and convertible redeemable preference shares.

With the acquisition of Chartered, Atic is growing its investment in the semiconductor sector, following its creation of US-based company Globalfounderies in a joint venture with Advanced Micro Devices Inc. in March.

Singapore's state-owned investment arm Temasek Holdings, which currently owns 62 per cent of Chartered's shares, fully supported the acquisition, said the companies.

"We believe that by having access to Atic's long-term capital and related assets, Chartered has an opportunity to bring its skills, capabilities and leadership to the next level," said Atic's chairman Waleed Al Mokarrab.

Chartered's had "assessed all strategic options available," said Jim Norling, the company's board chairman.

"We believe this transaction provides Chartered shareholders the opportunity to realize their investment," he said.

"It enables Chartered to accelerate its goal of becoming a leading player in the semiconductor industry," he added.

For the second quarter 2009, Chartered posted a net loss of 39.4 million US dollars, reversing a profit of 43.4 million US dollars it made in the same period last year. (dpa)