SEMICONDUCTOR
UPDATE
December 2008
McIlvaine Company
TABLE OF CONTENTS
Hemlock’s New $2.5 Billion Silicon Plant in Clarksville, Tennessee
City of Detroit Proposes Redevlopment of former Detroit Hospital
TriQuint Semiconductor Moved North Carolina Design Center into Bigger Facilities
Dow Corning Corp. Opened a $1.2 Billion Plant in Zhangjiagang, China as a JV with WACKER Chemi AG
SMIC Begins Production of 45-nm Silicon
Atmel Opens New Offices in Shanghai
Vistec Lithography Opens Cleanroom at Watervliet Arsenal
Renesas Technology Transfers All Shares to Silicon Foundry Holdings
Hemlock Semiconductor’s plans to invest as much as $2.5 billion to build a silicon manufacturing operation at the Commerce Park megasite.
The facility will produce polycrystalline silicon, a primary component used in the manufacture of solar panels and other energy equipment. Officials say it will create 500 jobs with the potential of employing up to 900 people within five to seven years. If fully implemented, the project would become the largest announced corporate capital investment in Tennessee history.
According to a news release from the state, the company will invest at least $1.2 billion to build and equip the plant but that figure could go as high as $2.5 billion.
When complete, the Clarksville facility will have the capacity to manufacture up to 10,000 metric tons of polycrystalline silicon annually but is being designed with the capability to manufacture up to 34,000 metric tons.
The plant will occupy the entire 1,215 acre Commerce Park megasite and the company plans to acquire an additional 947 acres adjacent to the site for additional build-out and to provide buffer space.
In addition to the Clarksville announcement, Hemlock Semiconductor also announced an expansion of its existing facilities in Michigan which, when combined with the Clarksville facility, will give the company the capacity to produce 45,000 metric tons of polycrystalline silicon annually, exceeding the combined production capacity of all other manufacturers around the world, according to the company.
Hemlock Semiconductor Corporation is the world's leading provider of polycrystalline silicon and other silicon-based products used in the manufacturing of semiconductor devices and passive solar cells and modules. Headquartered in Hemlock, Michigan, Hemlock Semiconductor is owned in majority and managed by Dow Corning Corporation
State and local tax capture valued at more than $1 million will support a proposed redevelopment of the former Greater Detroit Hospital. The development is to include a modern medical office and assisted-living facility. The project will generate $8.9 million in new capital investment and up to 251 jobs.
Taiwan Semiconductor Manufacturing Company (TSMC) and United Microelectronics Corporation (UMC) have announced their intention to continue developing 18-inch wafer products, or 450mm wafers. UMC’s CEO Shih-Wei Sun said “R&D cannot stop just because the economy is weak.”
Wafers are the thin layers of silicon that computer chips are created on. 450mm describes the diameter of the wafers that are grown and ultimately used in manufacturing. In previous years the various chipmaking companies have used 100mm, 200mm, 300mm and now they’re moving to 450mm. The reason to make them larger is this - as the processes used to grow silicon crystals become more advanced, larger and larger crystals become possible. The larger the crystal the larger the wafer diameter, and that means the more potential chip candidates can be created on a single thing to process.
We’ve all heard rumors of chip making fabs processing 5,000 or more wafers per day. With 200mm wafers a particular type of chip might generate 150 candidates. At 300mm each wafer may generate 225. At 450mm each wafer may generate nearly 400. By maintaining their current processing tools, just increasing the capacity of each step from 300mm (12 inch) to 450mm (18 inch), then the potential number of chips created can nearly double in the same amount of time. That means more revenue without much more difficulty processing.
The reason companies have not migrated to 450mm wafers sooner is because each migration requires a retooling of fabrication facilities, often costing billions of dollars. Intel is still to this day running some of its fabrication facilities as 200mm fabs, even though 300mm is showing itself to be far more lucrative.
Earlier this year Intel opened another 300mm fab facility in Israel, Fab 28. Note: Intel uses a “copy exactly” process for creating fabrication facilities. They use their D1D fab to work on next-generation tools, constantly renovating and updating it. Once they get volumes and yields up to their liking, they then begin copying everything to the new fab facility. Temperature, humidity, air pressure, water cleanliness, everything is copied. Intel’s copy-exactly process has shown that if a process works at location X, the exact same process will also work at Y, Z and A. Intel’s mature yields on various process technologies are rumored to be around 95%, meaning of all the CPUs they manufacture, 95 out of 100 work and can be sold.
TriQuint Semiconductor Inc. has moved its North Carolina design center into bigger facilities to accommodate its growing business in chips for mobile phones.
TriQuint,based in Hillsboro, makes semiconductors used in communications, including those used in mobile phones and the transmitter sites of mobile phone companies.
For the first nine months of this year, TriQuint’s revenue from mobile phone chips was $220.7 million, up from $187.5 million in the same period last year.
TriQuint’s sale of chips for advanced “smart” phones is growing even more strongly. The company increased its sales of these chips almost 500 percent during the third quarter, compared to last year’s third quarter.
Telecom technology analysts have discovered that TriQuint’s products are in Apple Inc.’s popular iPhone. TriQuint, which is often bound by nondisclosure agreements with customers, declines to confirm this on the record.
The company expects continuing strong sales of products for advanced phones, as consumers like phones that can display video, play music and browse the Web. Emerging markets such as India and China also represent opportunities for TriQuint.
TriQuint opened the new North Carolina design center two years ago with one person. It now has 23 employees, with room to grow to 50 over the next couple of years.
The $1.2 billion plant in China is a joint venture between Dow Corning and German chemical maker WACKER Chemie AG. The plant will make base chemicals used to produce silicone products.
Dow Corning has similar factories operating in the United Kingdom to serve the European market and in Kentucky to serve the North American market.
The new plant in China will supply Asia, where demand for the chemicals and their finished silicone products are emerging.
Dow Corning, which has six other facilities in China, opted to build the newest factory as a joint venture with WACKER to cut costs, improve quality and reduce risk. WACKER is a global chemical company based in Munich that employs about 15,000 people and had 2007 sales of about 3.78 billion euros.
Silicones have applications in products for construction, cosmetics, energy generation and the automotive industry.
The new factory will open in phases. The first stage came on line in November and, when completed, will be the largest facility of its kind in China.
Despite its size, it still ranks below Dow Corning's Hemlock Semiconductor Corp. expansion in Saginaw County. That facility is completing a $1 billion expansion on top of a recent $500 million expansion.
Hemlock makes silicon, a product entirely different than the silicone-related chemicals that will be produced by the Chinese operation.
Yet both plants are evidence of business growth for a company that was in Chapter 11 bankruptcy as recently as four years ago, to protect itself from lawsuits stemming from its silicone breast implants.
Semiconductor Manufacturing International Corp. (SMIC) has produced its first 45-nm yield lot, signifying a working 45-nm manufacturing process.
This has been achieved less than one year after SMIC signed an agreement with IBM to license its low-power and high-performance bulk CMOS technologies in December 2007. The first full-flow wafer lot consisted of 300-mm wafers that were run under test conditions set forth by IBM.
The 45-nm bulk CMOS technology licensed from IBM is suitable for ICs for use in mobile devices, such as handsets integrated with 3G base band, GPS, and multimedia processors. The technology also can support graphics, network, storage, and general consumer devices, SMIC said.
Chris Chi, senior vice president of marketing and sales, said the 45-nm process run substantiates SMIC's strategic decision to concentrate on logic technologies, and positions SMIC to offer 45m foundry solutions to both design and systems houses.
As part of extending its commitment to the China market over the last 15 years, Atmel Corp. announced the opening of its new location in Shanghai, China. This marks an important milestone as the company expands its reach throughout the mainland.
The offices will be located in the expansive new Shanghai Branch facility, located at 18F, Block B, Hi-tech Building, No. 900 Yishan Road, Shanghai PRC. 200233. They will provide design, and extended sales and engineering support for the growing Asian market.
In 2007, 50 percent of Atmel's worldwide revenue was from Asia. Recently, the company has signed distribution and representation agreements with a number of distributors, and intensive training courses on the company's technology and products have been provided to business partners and users.
Vistec Lithography Ltd. opened its new headquarters and cleanroom manufacturing center at Watervliet Arsenal, ending two years of anticipation.
State political leaders convinced Vistec to move from Cambridge, England, to Watervliet in 2006, offering $30 million in state incentives.
And after renovating 30,000 square feet of space in Building 125 at the arsenal, Vistec opened its doors to much fanfare.
Vistec currently employs 50 between the arsenal and lab and office space at the University at Albany's College of Nanoscale Science and Engineering.
It's part of a larger company, Vistec Semiconductor Systems, with offices around the world, which is owned by Golden Gate Capital, a $9 billion private-equity firm based in San Francisco.
Vistec makes sophisticated equipment used to imprint transistors on to computer chip wafers using electron beams in a process known as lithography.
Most of its customers use the machines for research and development. Each piece of equipment costs between $3 million and $3.5 million.
The new facility would ship its first completed system to the University of California at Los Angeles. The 10,000-square-foot cleanroom has enough space to make six machines at once. Each takes a few months to complete.
Ever since Vistec announced its plans to move to New York, local political and economic development leaders said it represented a shift in power in the semiconductor industry from places like Silicon Valley to the Capital Region.
The U.S. Army, which uses the arsenal to manufacture cannons, also hailed Vistec's opening as a preview of its development plans for unoccupied space at the facility.
The Army plans to make available 57 of its 143 acres to private development through a leasing program. And the Arsenal Business & Technology Partnership, a nonprofit group working to bring private business to the facility, has attracted more than 20 companies employing 300 workers.
Renesas Technology Corp., one of the world's leading semiconductor solution providers, has transferred all shares of the former Renesas Semiconductor Europe (Landshut) GmbH (RSEL), to Silicon Foundry Holding GmbH (SFH). The former RSEL facilities in Landshut are owned by SFH, a Germany-based company specializing in semiconductor pure-play foundry services.
The factory, which started wafer production in 1992, is currently producing secure microcontroller wafers for smart card applications on 0.35 um, 0.18 um and recently 0.15um process technologies. Over a number of years, there has been significant investment to expand the factory and convert it with new process technologies. Changes in the global semiconductor market are driving demand for products with smaller geometries produced on larger diameter wafers. To remain competitive, Renesas has therefore decided to concentrate its wafer fabrication investments in its bigger production facilities located in Japan, avoiding the larger capital investment required to increase flexibility of the facility to support advanced processes and rapidly changing market needs.
Renesas completed a thorough evaluation of all possible options for the future of the Landshut facility as a part of its global strategy, seeking to optimize and utilize its production resources worldwide. During this process, SFH made an alternative business proposal to transform the Landshut facility to an advanced analog pure-play foundry, which Renesas accepted. After the transfer of the fab, Renesas will outsource its products to SFH until December 2009. Furthermore, with 11 sales sites and 4 design sites in Europe mainly concentrated in the UK and Germany, Renesas remains committed to the European market. Renesas Technology Europe will enhance its Munich site by moving Renesas' European Quality Assurance Centre (EQAC) from Landshut to Munich, to provide high-quality semiconductor products with sufficient technical support.
Managed by two former RSEL managers, SFH will act as a local pure-play foundry, specializing in analog and mixed signal wafer production, providing a flexible approach to customer requirements. Based in Europe, SFH is in a good position to support a broad portfolio of customers there, including those seeking high flexibility and technology customization even in low volumes. In this market, which does not conflict with Renesas, there is considerable demand for analog products available at the Landshut site. SFH can immediately start production without modifications to the facility, rapidly addressing an existing market demand.
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