As part of a joint venture agreement inked last November, STMicroelectronics and Hynix
Semiconductor have laid the first stone at the site of their
front-end memory-manufacturing facility in Wuxi City, Jiangsu
Province, China.
The new fab is to manufacture both DRAM and NAND flash
memories.
The total investment planned for the project is $2bn to be
financed with equity from both partners, with Hynix contributing 67
per cent and ST at 33 per cent, along with $250m of long-term debt
from ST, and financing from Chinese local financial
institutions.
The companies are in the process of securing the required
governmental approvals and financing package. This year, ST and
Hynix are expected to invest $375m combined.
Hynix is relying on the joint venture relationship with ST as a
“firm base” for its long-term competitiveness in
securing 300mm manufacturing facilities with a minimum investment,
as well as the ability to use a cost-effective manufacturing
environment and maintain its leading position in the fast-growing
Chinese market, the company said yesterday.
Seoul, Korea-based Hynix also said the fab would provide it with
another global manufacturing facility that would resolve trade
issues including countervailing duties imposed on the
company’s products in the US and Europe.
From ST’s perspective, the company looks to the fab to
allow it to better serve its key telecoms and consumer customers
with memory, multimedia processor, and system solutions in single
packages on leading-edge technologies.
In particular, Geneva, Switzerland-based ST said the fab would
give it access to high performance, low-cost DRAM chips, enhancing
its capabilities in delivering multi-chip package (MCP) stacked
memories and system-in-package (SiP) products.
At the new fab site, a 200mm wafer line is scheduled to begin
production by the end of this year, initially with a stable
manufacturing process transferred from Hynix’ existing fabs
in Korea. Shortly thereafter, a 300mm wafer line is expected to
begin production in late 2006.
“Hynix Semiconductor has obtained solid footing to be a
global memory manufacturer as we have established a global
manufacturing network that connects Korea, the US and China,”
said Eui-Jei Woo, chairman and CEO of Hynix.
“Through the joint venture, Hynix believes the cooperative
relationship between ST, Wuxi and Hynix will be further
strengthened, and the new fab will be mutually beneficial for each
party’s long-term growth,” he noted.
www.hynix.com
www.st.com