Seoul, Dec 22 (IANS): South Korean tech giant Samsung Electronics has inked a deal to manufacture seven-nanometre (nm) microprocessors for US-based technology company IBM's central processing units (CPUs).

Samsung will manufacture seven-nm microprocessors for IBM Power Systems, IBM Z and IBM LinuxONE high-performance computing (HPC) systems and Cloud offerings, Yonhap news agency reported on Friday.

The deal is expected to help Samsung, which has Qualcomm Inc. as one of its clients, to beef up its foundry business utilising extreme ultraviolet (EUV) 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 in a statement.

"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 utilising EUV process technology paves the way to produce more precise chips compared with the conventional argon fluoride (ArF) 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.