Taiwan's major chipmaker United Microelectronics and U.S.-based GlobalFoundries are exploring the possibility of a merger, the Nikkei reported on Monday, citing an assessment plan seen by the newspaper.

If realised, the combined entity would establish a larger, US-based company with production capabilities spanning Asia, the US and Europe.

Shares in semiconductor foundry GlobalFoundries (GFS) fell today even though it was linked with a potential merger with Taiwan’s major