Sun has named Taiwan Semiconductor Manufacturing Company (TSMC) as its foundry partner for its new 45-nanometer chip.

TSMC has also signed up for future generations of chips for Sun. The deal is seen as a significant victory over rivals IBM and United Microelectronics who wanted the deal badly.

The Sun business is expected to provide TSMC with $500 million annually and 5 percent of its revenue. TSMC has been moving into the bulk-process microprocessor segment lately, where AMD is also making inroads.