"From an IBM and investor perspective, it takes one troubled area out of the core franchise."
IBM has been reducing its presence in the hardware industry. The company completed its $2.1 billion sale of the x86 server business to Lenovo Group earlier this month.
In 2005, Lenovo acquired IBM's consumer PC laptop business for $1.25 billion.
The business being sold focuses on chip design and manufacturing and is housed in the company's systems and technology unit, which accounted for about 11 percent of total sales in the third quarter.
Silicon Valley-based Globalfoundries said it would take over IBM's manufacturing operations in East Fishkill, New York and Essex Junction, Vermont, and offer jobs to substantially all IBM employees affected by the deal.
Globalfoundries Chief Executive Sanjay Jha said the company would invest $10 billion between 2014 and 2015 to develop 10 nanometer, 14 nanometer and radio-frequency technologies.
"As (IBM's) assets become part of Globalfoundries, they will benefit from the scale," Jha, the former CEO of Motorola Mobility, told Reuters.
Globalfoundries is owned by the Mubadala Development, the Abu Dhabi government's investment fund.
The deal is expected close in 2015.
—Reuters contributed to this report.