jan 07 update

SEMICONDUCTOR

UPDATE

January 2007

McIlvaine Company

World’s Largest Fab Starts 56nm NAND Flash Production at Year-End

Toshiba and SanDisk have announced that they are preparing to enter volume production of MLC NAND flash devices at the 56nm node in the first quarter of 2007 at Toshiba's Fab3, a 100,000wspm 300mm fab. 8-Gigabit devices will first be offered with the plan to make available 16-Gigabit devices in the second quarter of this year.

"With commencement of the 56nm technology, SanDisk is rolling out its fifth generation of MLC NAND flash memory," said Dr. Randhir Thakur, SanDisk's executive vice president of technology and worldwide operations. "The technology and design advances will help enable SanDisk products to offer approximately twice the improvement in write performance compared to the 70nm generation. We are pleased with the joint development of 56nm advanced technology with Toshiba, and expect it to become a production workhorse in Fab 3 during the second half of this year. We are executing according to plan and continue to make the captive fabs highly cost-effective sources of flash memory for our expanding array of consumer products," he added.

However, the significant news is that via its JV partnership, Flash Alliance, Ltd., the companies expect to initiate production at Fab 4 using the 56nm technology by the end of 2007. Fab 4 is currently under construction and is adjacent to Fab 3, which is one of the largest 300mm fabs in production today and has been noted for achieving one of most aggressive monthly ramp-rates for a 300mm facility to date. Fab 4 has an estimated production capacity (compared to Fab 3 cleanroom size) of approximately 150,000wspm when fully ramped.

Frontken to Further Expand Kulim Facilities
Frontken Corporation Bhd, a surface engineering provider in the semiconductor industry, will invest in another plant at its Kulim premises under the second phase of its expansion plan, its managing director and executive chairman Willie Wong said.

He said the new plant would cater to the increase in new projects as well as existing projects from its Singapore operations.

The investment in Phase 2 will be no less than the investment we made for Phase 1 of RM 25-million and the floor space would probably be five times more that that of its current plant which has a built up area of 32,000sq ft.

Phase 2 should be operational by late 2008. Their Kulim headcount would probably be up from 80 to 250 personnel. The company also had planned to construct a Phase 3 operation to fully utilise their landbank in the area, which stood at 2.7ha.

Frontken’s principal activities include being a service provider of mission critical surface metamorphosis engineering and solutions, or metal surface treatment and finishing, utilising numerous thermal spray coating methods as its core technology.

The company now has five facilities across Malaysia and another five in the region – three in Singapore and one each in Thailand and the Philippines.

Wong said that business from the semiconductor industry accounted for 31 percent of the group’s turnover in 2005 with the sector likely to contribute about one third of the group’s earnings this year.

SEMI’s 20th European Industry Strategy Symposium (ISS Europe 2007)

"Mobilizing Europe's strengths" is the theme of the 20th European Industry Strategy Symposium (ISS Europe) which will be held at the Kongress Haus Zurich, in Zurich (Switzerland) on 4-6 February 2007. The conference features high-level executives presenting on a range of topics vital to the European semiconductor industry including European investment opportunities, public policy, EHS and social legislation.

Europe boasts 283 IC-related production sites in microelectronics alone, and leads in the automotive and telecom industries. Recently, Europe has taken the lead in renewable energies such as photovoltaic and energy conservation. All of these markets are rapidly developing and address the needs of consumers and society as a whole. Europe has a highly qualified workforce, and is home to major semiconductor clusters in Grenoble, Dresden and Belgium/Holland, as well as regionally renowned R&D institutions.

"With the East expansion, Europe can rely on competitive manufacturing opportunities within our continent," said Heinz Kundert, president of SEMI Europe. "In order to secure timely commercialization it is essential that all of the players work together closely, to ensure the industry maintains its steady pace. ISS Europe provides a useful platform for sharing information, and participating in discussions which will help improve and refine our business strategies."

Samsung to Invest $1.9 Billion for Chips

South Korea's Samsung Electronics Co. announced a $1.9 billion investment plan to expand its production capacity for memory products.

The technology giant said it would use 819.8 billion won ($872.1 million) to build new production lines of dynamic random access memory chips. DRAMs are used mainly for computer memory.

Samsung Electronics said it would also spend 990 billion won ($1 billion) in upgrading existing chip production facilities.

It is also the world's largest maker of LCD panels and third-largest maker of mobile phones.

ProMOS Strikes Deal for 'Leased' Fab in Chongqing

Memory maker ProMOS Technologies intends to operate a government built fab in central China, in another sign of the Chinese upping the ante to lure big chipmakers.

ProMOS said it will invest $360 million in the project, a 200mm wafer fab in the city of Chongqing that will produce CMOS image sensors, power management ICs and embedded flash. State-controlled banks will lend another $360 million, while the Chongqing government will put up about $200 million to build the fab, and then lease it to ProMOS. If things go well, ProMOS will eventually buy the facility.

The notion of getting governments to shoulder the burden of fab construction and equipment move-in was most recently used by Shanghai-based Semiconductor Manufacturing International Co. (SMIC). Last summer, it agreed to operate facilities in Chengdu and Wuhan that will be built by the governments there.

ProMOS' Tseng said some local governments still remain aggressive in offering various perks and breaks to companies willing to build fabs in China. However, in more well established tech centers like Shanghai, the incentives are less alluring, he said.

For the Chongqing project, the cleanroom should be finished by the end of this year. Mass production will begin in the second quarter of 2008. The planned capacity is 60,000 wafers per month. ProMOS will buy new equipment for the first 20,000 wafers, and then transfer used equipment from a fab in Taiwan for the rest. Initially, ProMOS will use 0.25 micron design rules and then migrate to more advanced technology as the fab reaches full capacity by 2009.

ProMOS' plans follow the recent loosening of Taiwan government rules that control technology investment in China. Now that the way has been cleared, at least two companies, ProMOS and Taiwan Semiconductor Manufacturing Co., say they are ready to up the ante in China. TSMC has been in China for about two years with a fab in Shanghai capable of running 0.35- and 0.25-micron designs. That will now increase to 0.18 micron.

Hoku Materials to Build New Facility
Hoku Materials, a division of Hoku Scientific Inc., will build a new facility that will churn out 2,000 tons of polysilicon per year. The Hawaii-based manufacturer said that construction costs are approximately Rs.1178.32 crore ($260 million).

The plan for the new facility is in line with the company's signing of a supply contract with solar cell manufacturer Sanyo Electric Co. Ltd. Based on the contract, Hoku will receive about Rs.1,676.84 crore ($370 million) for a seven-year supply of polysilicon to Sanyo Electric. Shipments will begin in January 2009 and will last until December 2015. Sanyo Electric will give an initial deposit of Rs.9.06 crore ($2 million) to Hoku upon contract signing.

NXP Plans to Reorganize Netherlands Operations
NXP Semiconductors is planning to undergo reorganization for its two subsidiaries in the Netherlands, affecting at least 300 of its employees. The company has approximately 6,500 employees in the Netherlands, 4,300 of which are stationed in Nijmegen.

At its Nijmegen plant, NXP said that reorganisation efforts will include further efficiency improvements and adjustments to the support departments. NXP also plans to terminate an unprofitable business activity in Nijmegen. These adjustments are set to affect about 350 positions.

For the plant in Eindhoven, several jobs will also be made redundant. NXP said that they will try to employ the affected employees in a different position, but expects that redundancy is an inevitable option for some.

At present, the company is negotiating with unions and employee councils regarding the implications and implementation of the proposed measures.

Praxair to Supply Industrial Gases to Plant in China

Praxair China and Semiconductor Manufacturing International Corp. (SMIC) have signed a contract for Praxair to supply industrial gases to SMIC's new FAB 8 facility in Shanghai, China.

Praxair will upgrade its existing facility and pipelines in the Zhangjiang Hi-Tech Park to supply ultra-high-purity nitrogen, oxygen, argon, hydrogen and helium to the semiconductor plant. Praxair will also build and operate the purification and gas-monitoring systems located on the site.

SMIC's FAB 8 facility is a significant expansion of its existing facilities in Shanghai and will be used for the production of 300mm wafers with 90nm technology. Praxair also supplies SMIC's existing fabs in Shanghai and its 12-inch wafer fab in Beijing. SMIC is the largest producer of semiconductor chip wafers in China and one of the leading integrated circuit manufacturers worldwide.

Sanyo, Hoku Ink Polysilicon Deal

Hoku Materials, a division of Hoku Scientific Inc., has signed a polysilicon supply agreement with Japanese solar cell maker Sanyo Electric Co. Ltd.

Under the contract, up to approximately $370 million may be payable to Hoku during a seven-year period, subject to the achievement of milestones. The contract provides for the delivery of predetermined volumes of polysilicon each year at set prices from January 2009 through December 2015.

The contract also provides for an initial direct deposit of $2 million to Hoku upon signing and requires that Sanyo place approximately 30 percent of the total purchase amount in an escrow account with Bank of Hawaii.

Both companies each have the right to terminate the agreement if Hoku is unsuccessful in raising the additional capital required to complete the construction of the polysilicon plant within the next six months.

Hoku is a new entry in polysilicon, which is in short supply due to exploding demand in the solar cell industry. The company plans to build a plant in Idaho capable of producing 2,000 metric tons of polysilicon per year. Hoku estimates that the establishment of this larger facility may require total construction costs of approximately $260 million.

Hoku Scientific develops and manufactures fuel cell membranes and membrane electrode assemblies for stationary and automotive applications. The company is currently planning to expand its business to manufacture solar modules and polysilicon for the solar market.

Photronics & Micro Forming Tech Center

Photronics, Inc. and Micron Technology, Inc., today announced the formation of a joint venture known as MP Mask Technology Center, LLC.

The joint venture will develop and produce photomasks for leading-edge and advanced next generation semiconductors and will begin supplying these photomasks immediately. As part of the formation of the joint venture, Photronics will be investing $135 million over a three year period while Micron contributed its existing photomask technology center located at its Boise headquarters to MP Mask. Photronics owns 49.99 percent of the venture, while Micron owns 50.01 percent. In connection with the joint venture, Micron and Photronics have entered into a technology license agreement and certain supply agreements.

Complementing the investment each company is making in MP Mask, Micron and Photronics intend to build an independent state-of-the-art NanoFab in Boise, Idaho, that will be operated by Photronics for volume production of advanced technology photomasks. Photronics' investment in this facility is expected to fall within a range of $100 million to $150 million and will include new capital in addition to redeployed assets. The new facility is planned to fully leverage the technology developed inside MP Mask to create the industry's most advanced photomask supply, and will manufacture products for the most advanced applications for Micron and other Photronics customers.

This new facility is expected to be completed and to begin qualification by the end of 2007.

Photronics is a leading worldwide manufacturer of photomasks. Photomasks are high precision quartz plates that contain microscopic images of electronic circuits. A key element in the manufacture of semiconductors and flat panel displays, photomasks are used to transfer circuit patterns onto semiconductor wafers and flat panel substrates during the fabrication of integrated circuits, a variety of flat panel displays and, to a lesser extent, other types of electrical and optical components.

They are produced in accordance with product designs provided by customers at strategically located manufacturing facilities in Asia, Europe, and North America. Additional information on the Company can be accessed at www.photronics.com. Micron Technology, Inc., is one of the world's leading providers of advanced semiconductor solutions. Through its worldwide operations, Micron manufactures and markets DRAMs, NAND Flash memory, CMOS image sensors, other semiconductor components, and memory modules for use in leading-edge computing, consumer, networking, and mobile products. Micron's common stock is traded on the New York Stock Exchange (NYSE) under the MU symbol - Photronics

UMC on Track for New 300mm Fab, R&D Site

Foundry United Microelectronics Corp said it foresees opening a new 300mm wafer plant in 2008.

The plant, located near the southern Taiwan city of Tainan, will have a capacity of 45,000 wafers per month. It will be UMC's third 300mm facility — its first is also in Tainan (Fab 12A) and the second is in Singapore (Fab 12i). UMC expects about $5 billion to be spent when the tally is complete.

In March, the foundry also expects to complete construction of an R&D center in Tainan to research advanced nanometer manufacturing, the company said.

Fab spending in Taiwan looks ready to hold steady in the coming years, as foundries and memory makers splurge on new 300mm wafer facilities. Last month alone, Powerchip Semiconductor said it would team with Elpida Memory Inc to build four 300mm wafer lines in the next four to five years. The fabs will have a combined output of 240,000 wafers per month, and the project will eventually cost a whopping $13.9 billion.

At the same time, a few companies are seizing the chance to shift some production to China. With Taiwan loosening up on local companies making chips in China, a handful of firms have indicated they will invest in new fabs there or augment existing lines with more advanced technology.

The easing of restrictions came last month, after a years-long approval process. Some criticized the delay as paranoia on the part of Taiwan's government, which is cautious in its dealings with political and military rival China. Still, now that the way has been cleared, at least two companies, Promos Technologies and Taiwan Semiconductor Manufacturing Co., say they are ready to up the ante in China.

TSMC has been in China for about two years with a fab in Shanghai capable of running 0.35- and 0.25-micron designs. That will now increase to 0.18 micron. Promos will be taking its first baby steps in the mainland. Building is already underway for a 200mm wafer plant in Chongqing, where the local government will reportedly invest $200 million in to take a stake.

Powerchip Seeks to Lease Land for Four Taiwan Plants

Powerchip Semiconductor Corp. said it is applying to lease lands that would be sufficient for the nation's biggest computer memory chipmaker to build four new wafer plants in Taiwan to cope with increasing demand.

The Hsinchu-based company's expansion plan came not long after the government had given it the green light for plans to set up a factory in China and was a reaction to the government's call to companies to increase their investment at home.

Powerchip received approval for a US$401 million project to set up a plant in China that would manufacture chips on old equipment, using less advanced technology.

Science Parks

"The lands we have applied for at the Hsinchu and Central Taiwan Science Parks, if approved smoothly, will be big enough to build four 12-inch wafer facilities," Powerchip spokesman Eric Tan said in a filing to the Taiwan Stock Exchange.

However, Powerchip has no substantial plans in terms of schedule and spending for the new plants, yet, Tan said.

Joint Venture

Last month, Powerchip said it would form a joint venture with Japan's Elpida memory Inc to build four plants in Taiwan by pooling between NT$450 billion and NT$500 billion to manufacture computer memory chips, or dynamic random access memory (DRAM) chips.

Powerchip said early last year that it planned to build six 12-inch wafer factories over a five-year period, in addition to a vacant plant it purchased from local chipmaker Macronix International Co, to quickly expand its capacity in order to meet growing demand following the sale of Microsoft Corp's Vista Windows operating system.

Overall, DRAM revenues are expected to expand by 11.3 percent to just under US$40 billion, up from the US$36.95 billion estimate for last year.

Price Plunge

This year chip prices may plunge 31 percent, as has been the case in recent years, on a 65 percent year-on-year increase in output, compared with the unusual 13 percent decline experienced last year, it said.

Powerchip shares dropped 1.36 percent to NT$21.65 yesterday, underperforming the 1.25 percent loss on the benchmark TAIEX index.

Ban on New Factories in Metropolitan Area to Stay: Roh

President Roh Moo-hyun said the government will keep the controversial ban on new factories in the Seoul metropolitan area with a few exceptions. The presidential economic policy secretary Yoon Dae-hee said Roh made the remark in a meeting on the economic situation at the Gwacheon Government Complex in Gyeonggi Province on Thursday.

Permitting new factories to be built in or around the capital “could improve our competitiveness in the short term, but it will only aggravate concentration in the area in the longer term," he quoted Roh as saying. "Countries around the world are pursuing decentralization policies."

The remarks bode ill for the government’s decision on Jan. 15 whether to allow Hynix Semiconductor to expand its manufacturing facilities in the area. The chip maker wants to build a new semiconductor production line worth W12 trillion (US$1=W931) in Icheon City, Gyeonggi Province, which is subject to the Seoul Metropolitan Area Readjustment Planning Act. However, a Cheong Wa Dae official said Roh's remark on the day does not reflect any government position on that question.

Chipmaker UMC Set to Build Third Wafer Facility

United Microelectronics Corp, the world's second-largest contract chipmaker, yesterday said it plans to spend US$5 billion to build a third cost-saving 12-inch wafer facility to cope with future demand.

The new plant will have maximum output of 50,000 wafers a month, UMC said in a statement. The chipmaker said it is scheduled to move in equipment in the first quarter of next year but did not set a timetable for mass production.

UMC operates a 12-inch factory in Tainan's Science Park and another in Singapore. The company also has six 8-inch plants and one 6-inch factory in Taiwan.

UMC said it planned to invest U$1 billion in new equipment and facilities this year.

Bigger rival Taiwan Semiconductor Manufacturing Co now operates two 12-inch plants and seven 8-inch plants, including one in Shanghai.

UMC is set to have completed by March the construction of a research and development center for advanced nanometer processing technologies in the Southern Taiwan Science Park.

Shares of UMC dropped 1.5 percent to NT$19.7 yesterday, while TSMC shares dropped 1.64 percent to NT$65.8.

Intel Seeks to Make Chips in China

China’s government is considering a plan by Intel of the US to build a chipmaking plant in the north-eastern city of Dalian, say local industry officials.

Construction of such a fabrication plant, or fab, by the world’s biggest chipmaker would mark a breakthrough for China’s nascent semiconductor industry and a major expansion of Intel’s presence in the rapidly growing Chinese IT market.

It could also fuel concerns in the US about the transfer of leading technology to China, which some in Washington see as an economic and military rival.

Intel has chip assembly and test facilities in Shanghai and the western city of Chengdu but has held back from manufacturing in China.

China’s leading chipmakers are all foreign-owned but no company with the global presence of Intel has chosen to make the country a manufacturing base.

An application for a fab in Dalian was submitted to the central government, according to two industry officials who declined to be identified.

The factory is not expected to make microprocessors given the difficulty of gaining an export licence from the US government for such sensitive technology.

Chip manufacturing facilities cost upwards of $2 billion and the factory would represent Intel’s biggest single investment in Asia, a region that represents the fastest growing and largest geographic segment for the company.

A Beijing-based spokesperson said Intel routinely considered new sites for its operations and China was “one of our target countries”.

The Chinese officials declined to give details of the planned Dalian fab or to say how much it was likely to cost. One said: “Although the investment will be very big, it will be made in stages, and the final figure . . . has not yet been fixed.”

Intel has already committed $1.3 billion to China and employs 7,000 local staff. Intel’s top executives have made repeated visits to China, with Craig Barrett, chairman, meeting the Chinese vice premier in November.

The company has had a presence in China for more than 20 years and employs over 6,000 people. It launched a $200m venture capital fund in 2005 dedicated to Chinese companies.

Praxair to Supply New SMIC Wafer Plant in Shanghai

Praxair China and Semiconductor Manufacturing International Corp. (SMIC) have signed a contract for Praxair to supply industrial gases to SMIC’s new FAB 8 facility in Shanghai, China.

SMIC’s FAB 8 facility is a significant expansion of its existing facilities in Shanghai and will be used for the production of 300mm wafers with 90nm technology. Praxair also supplies SMIC’s existing fabs in Shanghai and its 12-inch wafer fab in Beijing. SMIC is the largest producer of semiconductor chip wafers in China and one of the leading integrated circuit manufacturers worldwide.

“We are proud to be chosen again by SMIC as its strategic supplier for its new state-of-the-art wafer facility. We have been working with SMIC since its inception in 2000 and are pleased to have been a major supplier during its growth as the preeminent semiconductor manufacturer in China,” said Minda Ho, vice president, Praxair China.

Chinese Science Park Officials in Talks with Intel for Chip Fab
Officials in a northern China science park are stoking rumors that Intel Corp. wants to build an advanced chip plant in the area and will announce its intentions as early as March.

An official at the Dalian Economic Technological Development Zone confirmed that it is in talks with Intel, but nothing has been finalized. "It's not only for packaging," the official said, declining to offer more details until a contract is signed.

A report by Reuters suggested Intel would invest "billions" in a fab that would make dual-core processors on a 65nm process. Rumors that Intel will build a chip plant in China have cropped up perennially for at least five years. Each time nothing has happened, or the "advanced" chip making facility turned out to be a chip packaging plant. Intel runs such plants in Shanghai and Chengdu.

X-FAB Sarawak Switches to Analog Chips Production

Wafer manufacturer X-FAB Sarawak Sdn Bhd, formerly known as Ist Silicon (M) Sdn Bhd, will phase out its digital and flash technologies and switch to analog chips to cater to its customers in the United States and Europe.

The change in the company’s business plan followed the recent merger of state-owned Ist Silicon with Germany’s X-FAB Semiconductor Foundries.

The Sarawak government, through state-owned Financial Secretary Incorp, now owns a 35 percent stake in the merged entity, which has assets and manufacturing facilities in Germany, the US and Britain. The other 65 percent is held by X-FAB's holding company, X-Trion.

X-FAB Sarawak chief executive officer Roger Diels said as X-FAB was the world’s largest analog-mixed signal foundry group manufacturing wafers for analog-digital integrated circuits, it was more competitive in the analog market. The company started producing analog chips in 1992.

Diels said the group, which recorded US$20mil in profits last year, now had more than 200 active customers worldwide. Some 90 percent of its production is for the analog market.

Global demand for analog chips was still growing, he said, adding that the Kuching facility would have no problem switching to analog processes as it had very good equipment and engineers to develop new technology.

Offshore Centre for Fujitsu Opens in Technopark

Network Systems and Technologies Pvt Ltd, the global engineering software services wing of the NeST group, Monday opened an offshore development centre for Japan's Fujitsu VLSI Ltd at the Technopark campus here.

A subsidiary of Fujitsu Ltd - a Fortune 500 firm, Fujitsu VLSI is a total solution provider of electronic devices.

Fairchild to Acquire All Shares of System General
Fairchild Semiconductor Corp. is expected to launch a tender offer to acquire 100 per cent of the outstanding shares of System General Corp. through a wholly-owned Fairchild subsidiary. The purchase price is expected to be about Rs.910.40 crore ($200 million).

System General is a major designer and supplier of analogue power management chips. Fairchild is expected to retain nearly all the 250 employees of the Taiwanese group, including the current management team.

Fairchild expects the acquisition to be neutral to its earnings per share in 2007 and to be accretive to earnings per share in 2008 and beyond.

SPIL to Invest NT$30 Billion in New Taiwan Plant
While rivals are aggressively extending their presence across the Taiwan strait, Siliconware Precision Industries Limited (SPIL) maintain its roots in Taiwan, with the company investing as much as NT$30 billion in its new Changhua, Taiwan plant, said company president C. W. Tsai during the ground breaking ceremony for the plant.

SPIL reiterated that the company’s present facilities in Taichung have not been able to fulfill demand since the second quarter of 2006. In light of demand expected to warm up for consumer electronics prior to the 2008 Olympics Game, SPIL anticipates the capacity coming from the new site will come in handy.

Construction will be in two phases with the first phase expected to be completed in the third quarter of 2007 with production to start in the fourth quarter of 2007, Tsai said. Second-phase construction will depend on the market situation. The Changhua plant will mainly handle chip-scale package (CSP) and quad-flat package (QFP) applications.

AMD Plans 300-mm Fab in New York

Preparing to build a new 300-mm fab in the United States, Advanced Micro Devices Inc. said that it has signed a grant disbursement agreement (GDA) with the State of New York. The agreement establishes a two-year window from July 2007 to July 2009, in which AMD can choose to initiate the building of a new 300-mm fab in Saratoga County, N.Y. AMD's execution of the agreement comes after New York's Public Authorities Control Board (PACB) voted last week to approve a $650 million grant for AMD.

AMD originally disclosed plans to build a fab in New York. AMD (Sunnyvale, Calif.) anticipated the need for a new facility and has selected the Luther Forest Technology Campus as an ideal site. The timing of the final decision depends on a number of factors, including future market demand, according to AMD.

If conditions become right for AMD to move forward, construction would begin sometime between July 2007 and July 2009. Similar to AMD's other fabrication facilities, construction of the building is expected to take about a year with another year needed for the installation of equipment and tools.

The project has the potential to directly create approximately 1,200 new jobs, along with thousands of indirect jobs through supporting construction and infrastructure projects.

Rohm and Haas Electronic Materials Opens Asia-Pacific Manufacturing and Technical Center in Taiwan

Rohm and Haas Electronic Materials, CMP Technologies, a leader and innovator in chemical mechanical planarization (CMP) technology for the global semiconductor industry, recently officially opened its Asia-Pacific Manufacturing and Technical Center in Taiwan. Representing a $50 million investment, this center is CMP Technologies' first CMP pad manufacturing site and technical center in Asia outside of Japan and will play a pivotal role in supporting regional customer growth.

The site is located in the Hsinchu Science Park, Chunan satellite campus, a center of advanced 300mm manufacturing for the global semiconductor industry.

By placing the CMP Technologies Asia-Pacific Manufacturing and Technical Center here, the company will be close to local foundries, integrated device manufacturers, and memory device manufacturers, as well as having a central location to provide timely service to its customers throughout the Asia-Pacific region. This central location in the Hsinchu Science Park will also provide room for future expansion, as the industry continues to thrive and grow across the region.

“Most of our business is located in the Asia-Pacific region, where much of the world's chip manufacturing business now resides, so Taiwan was a natural choice for the location of this facility,” said Mario Stanghellini, executive vice president, global sales and marketing, Rohm and Haas Electronic Materials, CMP Technologies. CMP Technologies' Asia-Pacific Manufacturing and Technical Center will serve as the production site for the company's next-generation IC1000™ polishing pads, the new IC1000™ AT pad, and the VisionPad™ family of products. This facility will provide increased pad manufacturing capacity to address the growing demands in the region.

In addition to manufacturing, the 23,000-square-meter site will also house a sophisticated applications lab as well as sales and customer support offices. The applications lab will include a 300- to 500-square-meter class 10 cleanroom equipped for CMP polishing, cleaning and metrology, as well as standard analytical equipment for pad and slurry analysis. This will provide CMP Technologies with the capability to do customer demonstrations and support new product implementation locally and regionally.

The manufacturing and technical center will employ engineers, management and customer support staff, as well as operators and technical staff. Daniel Fang, Asia technology director for Rohm and Haas Electronic Materials, CMP Technologies, will oversee the technical center, while Cliff Chen will serve as manager for the manufacturing plant.

By 2010 the entire facility will house approximately 150 to 160 people, with manufacturing and laboratory personnel trained at Rohm and Haas facilities in the United States.

Taiwan Approves Three Semiconductor Investments in China

Taiwan has given approval for three semiconductor companies to invest a combined $825 million in China, in a sign the island's government is softening its long-standing opposition to high-tech investment by local firms in its political rival.

A cross-ministerial committee approved a $400 million investment by Powerchip Semiconductor Corp. and a $365 million investment by ProMOS Technologies Inc. Both companies make memory chips. The committee also approved a $60 million investment by Advanced Semiconductor Engineering Inc., the world's largest chip-packaging company by revenue.

Like manufacturers around the globe, Taiwanese chip companies have been eager to shift their manufacturing base to lower-cost centers such as China due to increasing competitive pressure to cut costs. But Taiwanese companies have been at a disadvantage due to the tight curbs the island's government places on investment in mainland China.

Since it came to power in 2000, the independence-leaning government of President Chen Shui-bian has discouraged Taiwanese companies from investing in the mainland, fearing that additional economic ties to Beijing would reduce the island's wiggle room in the event of political confrontation. Taiwanese investment in China already exceeds $100 billion.

While Taiwan's approval of the investments won't be financially meaningful for the two chipmakers as it involves older 0.25-micron production technology, analysts say it's a significant "first step."

ProMOS and Powerchip will use the 0.25-micron technology to make eight-inch wafers. The memory-chip makers won't enjoy an immediate revenue contribution because it will take time to build the necessary facilities in China, and as memory chip makers around the world are already migrating to the more advanced 0.09-micron technology.

The two memory-chip makers submitted their applications in December 2004, but the review process took much longer than expected, in part because of icy relations between Taiwan and China.

Advanced Semiconductor applied in October to buy small Chinese rival Global Advanced Packaging Technology Ltd., which uses the older but still mainstream wirebond packaging technology.

McIlvaine Company,

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