With the aim of increasing production while reducing costs to make high-density NOR flash for mobile phones, embedded applications and other devices, Geneva-based flash memory company Numonyx BV and Elpida Memory 
have signed a foundry agreement for Elpida to manufacture NOR flash memory in its 300mm Hiroshima wafer fab.
Numonyx, formed by the flash divisions of Intel 
and STMicroelectronics, believes this agreement will boost its ability to meet demand for its products, especially as it increases its focus on the embedded NOR market segment, and allows Elpida to utilize its fab equipment efficiently and longer by engaging in both foundry and DRAM manufacturing using different generation technologies.
Brian Harrison, president and CEO at Numonyx commented in a statement, "Working with Elpida means that we are able to collaborate with a proven technology company with highly-efficient facilities and large-scale capacity that can help us deliver on that promise in the most cost-effective way."
Numonyx's manufacturing supply network, which Elpida is now a part of, is part of the company's strategy to serve both existing customers in need of long-life support as well as to prepare for growth.
Further, Numony said its existing 200mm facilities will continue to provide supply to many of its current customers that do not want to incur costs and complexities associated with re-qualifying its parts, but with the added 300mm capacity, the company believes it will be in a better position for growth in the wireless market segment where it already produces large volumes associated with its leading share in that segment.
The companies plan to begin technology transfer and development activities for Elpida's Hiroshima Plant soon, with initial production expected in the middle of next year.
Elpida said it will allocate a portion of its capacity of approximately 120,000 wafers per month to Numonyx for the production of both 65- and 45nm NOR flash products, with believes the combination of leading-edge lithography and 300mm sized wafers will help give it a competitive advantage.
Mark DeVoss, senior analyst with iSuppli noted, "Growth in the NOR market segment has traditionally come largely from handsets, but growth has been slowing in recent years. However, growth in the embedded segment could account for their need for added NOR capacity, and the fact that Numonyx sought and secured capacity that is readily available from a qualified, reliable source like Elpida could mean good things for the NOR flash memory segment. This is certainly an efficient way for Numonyx to manage its business - from a financial standpoint it makes perfect sense."
Following the agreement, Numonyx and Elpida said they will finalise a definitive agreement within the current quarter.
By Ann Steffora Mutschler, Senior Editor - Electronic News