US information technology giant IBM Corp. said Friday that South Korean chipmaker Samsung Electronics Co. will manufacture 7-nanometer microprocessors for its CPUs.

According to IBM, Samsung will manufacture 7nm Power processors for IBM Power Systems, IBM Z and IBM LinuxONE high-performance computing systems and cloud offerings. 

The deal is expected to help Samsung, which has Qualcomm Inc. as one of its clients, to beef up its foundry business utilizing extreme ultraviolet process technology, industry watchers said.

A foundry business refers to making chip designs for other companies that do not have a semiconductor fabrication plant.

"The agreement combines Samsung's industry-leading semiconductor manufacturing with IBM's high-performance CPU designs," IBM said. "It positions IBM and Samsung as strategic partners leading the new era of high-performance computing specifically designed for artificial intelligence."

The two companies will also be extending their strategic research alliance, which has lasted for 15 years, IBM said.

Samsung claims that utilizing EUV process technology paves the way to produce more precise chips compared with the conventional argon fluoride immersion technologies, which can better meet demand from emerging big-data and AI industries.

The South Korean tech giant started the construction of its new production line equipped with EUV facilities in Hwaseong, south of Seoul, in February this year, which will commence operations in 2020. (Yonhap)