Koreans put economy saving deal into action

Koreans put economy saving deal into action
Hyundai, LG Semicon and Samsung swap deal; Scottish fab plans are suspended. David Manners. The ‘Big Deal’ in Korea is now on, say authoritative sources in Seoul, with Hyundai giving its petrochemicals business to LG, LG giving its semiconductor business to Samsung, and Samsung giving its car business to Hyundai. The Korean government has been pressing the three companies to implement these deals for some months, but the companies have been resisting them. Recent press stories that Intel would take a stake in LG Semicon were generally seen as a last ditch attempt by LG to avoid being taken over by Samsung. What Samsung will do with LG Semicon is unclear. Rivals are hoping that it will close down LG’s fabs so helping to bring DRAM supply and demand into balance. It is thought that Samsung will be reluctant, initially, to put its brand on LG DRAMs until it has completed a quality audit. Meanwhile, Hyundai has officially confirmed that it has indefinitely postponed the 64Mbit fab it was building at Dunfermline. An executive asked EW: “What’s the last thing the world needs now?” All 64Mbit manufacturers are selling the chip at a loss. Back in April, Hyundai executives in Seoul told EW that they would not need the Scottish fab for 64Mbit DRAM because of the vast over-supply situation, and that if they ever do use the fab it will be for 256Mbit DRAMs which will not be required until 2000/1. Earlier this week, Hyundai confirmed that it would review, in the future, plans to make more advanced memories at Dunfermline. Hyundai shelves Scottish fab Hyundai shelves Scottish fab Hyundai has “indefinitely suspended” its troubled ?2.4bn chip fabrication plant at Halbeath near Dunfermline in Fife, Scotland – leading to fears it will never be built. But Locate in Scotland boss Martin Togneri, Scottish Industry Minister Brian Wilson and local MP Rachel Squire put a brave face on the decision and claimed the project could go ahead after the year 2000. Hyundai management claims, after lengthy talks with Togneri, that despite the latest delay the plant still has an important part to play in the future strategy of the company. Togneri said: “I believe Hyundai will eventually come to Dunfermline. It is just a matter of when.” He admitted the earliest time the new technology could come on stream was 2000. Wilson said the decision was “regrettable” but welcomed the commitment to a future at the site while Dunfermline West MP Rachel Squire said she still had “some hope” of the fab opening.


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