SEMICONDUCTOR

UPDATE

 

May 2008

 

McIlvaine Company

www.mcilvainecompany.com

 

TABLE OF CONTENTS

 

 

KLA –Tencor Opened a New Facility in Singapore

Signet Solar Opens Factory in Germany

ON Semiconductor Opens Joint Lab

Green Energy the First to Set Up Solar-Panel Factory in China

SunPower to Build Fab 3 in Malaysia

Tower Acquires Jazz

Motech and Splar Semi Collaborate

Vistec Moves to New Cleanroom Facility

Freescale Closed Tempe Facility

DayStar Opens Pacific Research Center

CoorsTek Opens Ceramics Plant

AMD Still Intends to Build a Fab in the USA

Title Qimonda Joins Centrosolar in Portugal

SAFC Opens 5,000 Sq. Ft. Cleanroom in Wisconsin

StratEdge Gets ISO Certification

SOLAR

Swiss Oerlikon and Others Build Solar Facilities in Singapore

 

 

 

KLA –Tencor Opened a New Facility in Singapore

San Jose-based KLA-Tencor will use the facility to "significantly expand" manufacturing as well as enlarge training, sales and corporate functions.

 

The 17,400 square-meter (187,224 sq. ft.) building provides state of the art cleanroom space for manufacturing process control products, with room for future expansion.

 

"These products are extensively used in virtually every semiconductor 'fab' worldwide, and the latest systems can detect nanometer-scale defects and anomalies on the wafers used to make the most advanced chips," KLA-Tencor said.

 

Company CEO Rick Wallace said the facility "is a major step forward for KLA-Tencor in diversifying our process control product manufacturing and supplier relationships into Asia, where a growing percentage of our customer base is located. Singapore is an important regional hub and offers compelling advantages for our future business operations."

 

Signet Solar Opens Factory in Germany

Germany is again making news in the solar field with the announcement of the industry’s first ever Gen 8.5 (5.7 m^2) silicon thin film solar PV module at Signet Solar’s new factory near Dresden. The accomplishment at the company's 200,000 square foot production facility and is another step towards lowering the cost of renewable solar energy through thin film technology.

 

Signet Solar says it has lowered the production cost of photovoltaic (PV) modules by combining silicon thin film technology with very large area manufacturing and an industry standard equipment set. The initial modules from the new manufacturing line met the specification of the product and were confirmed by independent testing by Fraunhofer Institute. Signet will start prototype production in early June and will showcase the Gen 8.5 module product line at the Intersolar Conference in Munich. Commercial production will start in the third quarter of 2008, with capacity expansion to over 100MW at the same site expected by 2009.

 

Thin-film cells use a manufacturing process which involves applying multiple thin layers of a sunlight reactive substance onto a base material. The major benefit of thin film technology is that it can cover larger spaces, whilst the cells require less than 1 percent of raw materials compared to other manufacturing methods making it cheaper to produce. Additionally, the flexibility of modules and the ability to deposit the cells on all kinds of substances means thin-film solar panels can be integrated into roof tiles and other architectural materials.

 

Like all solar cells, the thin-film production process is still energy intensive and requires the use of limited resources such as silicon, copper and cadmium. However, when this cost it weighed up against the use of fossil fuels for ongoing residential and commercial energy consumption, investing in production in the short term definitely provides long term benefits.

 

Signet Solar will commence commercial production of the modules in Q3 2008 with plans to expand capacity to more than 100MW by 2009. The company says it has existing customer commitments of over $400 million.

 

ON Semiconductor Opens Joint Lab

ON Semiconductor has opened a joint power laboratory with Xiamen Overseas Chinese Electronic Co. Ltd (Xoceco) and Malata in Xiamen, Fujian Province. This brings the total number of joint power labs that On Semi has opened in China to seven, following the successful establishment of six other labs with other China companies including Hisense, Haier, Changhong and Skyworth.

 

The latest lab in Xiamen provides a platform for engineers from Xoceco and Malata to work with On Semi's resident field application engineers on new power solutions for consumer applications including LCD TVs.

 

"Establishing joint power labs is part of our strategy to strengthen partnership with market leaders in China and help develop power solutions for their next generation products," said David Chow, On Semi VP of sales for Asia Pacific. "The lab will enable both our customers' engineers to collaborate with On Semiconductor's field application engineers to drive innovative and highly efficient power solutions. Our proven power solutions will help the two companies optimize power efficiency and minimize standby power consumption in their products, meeting consumers' demand of high performance and low power dissipation, in China and abroad."

 

ON Semiconductor Corp. is a Phoenix-based company that manufactures computer chips for numerous applications.

 

Green Energy the First to Set Up Solar-Panel Factory in China

Green Energy Technology Inc. (GET), the largest solar-panel crystal-growing manufacturer in Taiwan, reportedly plans to set up a plant in China, making it the first Taiwan-based company there, according to local Chinese-language economic daily newspaper Economic Daily News (EDN).

 

EDN said that GET might choose among Liaoning, Shandong, Shanghai to construct its new plant. GET is already an OEM supplier for Suntech Power, the largest solar-cell maker in China, with the plant-building expected to further expand the partnership between the two parties.

 

Suntech, GET's major customer, expects to ship solar-cell panels with total capacity of 530 MW this year, is currently the largest solar-cell maker in the Great China region with annual revenue of US$1.9 billion to US$2.1 billion.

 

As exports of poly-silicon products are levied 17% in value-added tax, the insider said, GET's new plant in China could enable material supply directly from Suntech at lower cost to achieve higher margins.

 

Solar power is one the focal-points in the Chinese central government's 11th five-year economic development plan, suggesting promise in the huge market.

 

Other Taiwan-based solar-cell-related companies have also set up business in China by establishing production facilities or through re-investments, including Motech Industrial Inc., PanJit International, Wafer Works Corp. etc.

 

GET, however, will be the first Taiwan-based solar-cell producer in China. Currently GET is the largest solar-cell crystal-growing maker in Taiwan with a maximum annual capacity of 400 MW (megawatt), while the company is actively stepping into thin-film type solar-panel segment with a new product line to be inaugurated in the fourth quarter this year

 

SunPower to Build Fab 3 in Malaysia

SunPower Corp. will establish its next solar cell fabrication plant in Malaysia, which is expected to have a nameplate rating in excess of 1GW of annual production capacity.

 

Fab 3 is expected to be constructed in two phases, with the first phase comprised of 14 solar cell production lines with a nameplate capacity of 40MW each. After completion of phase two, at a scale in excess of 1GW, Fab 3 is estimated to achieve materially lower capital cost per watt compared to SunPower's Fab 1 and Fab 2.

 

Solar cell production in Fab 3 is slated to begin in 2010, with the integrated site development planned to start later this year. SunPower will launch its manufacturing operations with its 22 percent minimum rated Gen 2 solar cells, and expects to add production of its recently announced, higher-efficiency Gen 3 solar cells at a later date.

 

"The scale and breadth of our Fab 3 campus in Malaysia will be a core element of our technology and manufacturing roadmap that drives us to our 50 percent cost reduction plan by 2012," said Tom Werner, CEO of SunPower. "Malaysia offers us highly educated workers, a receptive business investment climate and the opportunity to significantly expand our production as the demand for our solar systems continues to escalate worldwide."

 

Tower Acquires Jazz

Tower Semiconductor Ltd., an independent specialty wafer foundry, and Jazz Technologies, Inc., a leader in Analog-Intensive Mixed Signal (AIMS) foundry solutions, announced the signing of a definitive agreement by which Tower will acquire all of the outstanding shares of Jazz in a stock-for-stock transaction valuing Jazz at a fully diluted equity value of approximately $40 million, based on Tower's closing price on NASDAQ on May 19, 2008. Under the terms of the agreement, each outstanding share of Jazz common stock will be converted into the right to receive 1.8 Tower ordinary shares. The total value of the transaction, including net debt, is approximately $169 million.

 

The agreement has been unanimously approved by the boards of directors of both Tower and Jazz and the transaction is subject to the approval of Jazz's shareholders and other customary closing conditions. The transaction is expected to close in the second half of 2008.

 

Motech and Splar Semi Collaborate

Motech Industrial and Solar Semiconductor recently agreed to collaborate on development of thin-film solar cell technology and silicon-wafer supplies shortly after Motech received Solar`s lucrative orders for 120 megawatts of solar cells.

 

Industry watchers estimated the orders at over NT$10 billion (US$333 million at US$1: NT$30), given that one megawatt of solar cell now sells for around NT$100 million (US$3.3 million).

 

Solar Semiconductor is among the top three Indian suppliers of solar modules, specializing in polycrystalline and mono-crystalline solar modules.

 

Although Motech, a leading Taiwanese solar-cell maker, has declined to confirm reports on the contracts, Solar Semiconductor President Hari Surapaneni already announced the deal and said Motech is his company’s partner in high-end solar modules.

 

Indian government has been pushing hard the use of solar energy, creating an Indian market for renewable energies estimated at US$19 billion over the next five years. The recent contracts give Motech a chance to enter the lucrative market.

 

Motech is boosting capacity at a factory in the Southern Taiwan Science Park and a factory in Kunshan of mainland China. The factory in the science park is planned to have maximum output of 100 megawatts of cells by the end of this year while the Kunshan factory’s added capacity will start to run in July this year.

 

Vistec Moves to New Cleanroom Facility

Vistec Lithography Ltd. is scheduled to move into its permanent headquarters at the Watervliet Arsenal within two weeks, and into its new cleanroom facilities as early as next week.

 

The company, which develops semiconductors, has already moved into its new warehouse space at the arsenal.

 

Vistec, which in 2006 announced plans to move its headquarters in Cambridge, England to the Albany, N.Y. area, will occupy about 12,000 square feet of cleanrooms and another 12,000 square feet of office, warehouse and storage space in the arsenal's remodeled Building 125. The company is temporarily housed in Building 44 at the arsenal. The cleanrooms should be inspected, certified and ready for occupancy next week.

Vistec will continue its development of electron beam lithography equipment at the University at Albany's College of Nanoscale Science and Engineering, where it employs eight people at the University's Center for Nanolithography Development.

 

Between 50 and 60 new jobs will be created at its newly refurbished arsenal offices. Operations from the company's new headquarters will include sales, marketing and production.

 

Freescale Closed Tempe Facility

Freescale Semiconductor of Austin, Texas USA, will be closing its 17-year-old chip factory in Tempe, Arizona, according to an article in the Arizona Republic. The factory makes gallium arsenide (GaAs)-based chips for wireless applications. Freescale sold its power amplifier business to Skyworks Solutions Inc. last October. Since then, the Tempe foundry has been not been producing much because the principal business for the foundry was sold.

 

 Freescale attempted to sell the foundry but found no buyers. The company decided to close the foundry, and layoff 100 of its 23,000 member workforce worldwide. The company’s research and development facilities in Tempe and its facilities in Chandler were not affected by the closure. The facility is expected to close over the next few months.

 

DayStar Opens Pacific Research Center

DayStar Technologies signed a 10-year lease with BioMed Realty Trust Inc. for 157,140 square feet at 7333 Gateway Blvd. in Phase I of the Pacific Research Center in Newark, CA. The solar energy company also negotiated an optional one-year expansion for the remaining 161,026 square feet in the building. It will occupy the only manufacturing space at the Pacific Research Center in July.

 

CoorsTek Opens Ceramics Plant

CoorsTek opened their newest technical ceramics manufacturing facility in Gumi City, South Korea. Significant increases in demand for high-purity and other specialty ceramics, primarily for the semiconductor manufacturing and flat-panel display industries, fueled the additional facility.

 

The new facility, located in Gumi City, Korea, will be more than three times larger than their current location in Kyungbook and will serve as a manufacturing hub for most of Asia to accommodate continued market growth in the sector. For neighboring customers including Samsung, LG Phillips LCD, Hynix, and Magnachip Semiconductor, CoorsTek expects to offer enhanced customer interaction, higher regionally-built content, and improved service levels.

 

CoorsTek is the largest technical ceramics manufacturer in North America and has facilities in Europe and Asia. CoorsTek supplies critical components and assemblies for medical, automotive, semiconductor, aerospace, electronic, power generation, telecommunication, and other high-technology applications. Utilizing advanced material technologies, the company's engineered solutions enable its customers' products to overcome technological barriers and improve performance.

 

AMD Still Intends to Build a Fab in the USA

Even though Advanced Micro Devices did not start construction of its Fab 4x this spring, as it was expected, the world’s second largest supplier of x86 central processing units (CPUs), said at a news-conference that its plans to build a semiconductor manufacturing facility were “moving along”.

 

Advanced Micro Devices is currently considering its asset-smart strategy under which the company reportedly plans to reduce its investments into manufacturing. Actual details of the strategy are not clear, but some analysts believe that AMD plans to form joint-venture (or joint-ventures) with contract semiconductor manufacturers to produce chips for AMD and others at facilities controlled by AMD.

 

AMD has time till July 2009 in which AMD can choose to initiate the building of a new 300mm wafer fabrication facility in Saratoga County, New York. AMD has already received $650 million grant from the authorities to prepare for construction. The incentives offered by New York include a $500 million grant for construction, $150 million in R&D subsidies to be used over 5 years, and $250 million tax rebate.

 

AMD anticipates the need for a new facility and has selected the Luther Forest Technology Campus as an ideal site. 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 1200 new jobs, along with thousands of indirect jobs through supporting construction and infrastructure projects. According to AMD, about 5500 new jobs in total will be created thanks to the Fab 4x. Earlier AMD said that plant will initiate manufacturing in 2010 and will allow AMD to increase manufacturing capacities by 50 percent when compared to expected 2008 level. However, it is now almost clear that the Fab 4x will hardly initiate production in two years from now

 

Title Qimonda Joins Centrosolar in Portugal

Qimonda AG (NYSE: QI), a memory supplier with a diversified DRAM product portfolio, has entered the solar market through a joint venture with Centrosolar Group AG (C30.DE) to produce crystalline solar cells.

 

The companies will establish a production plant near Porto, Portugal next to an existing semiconductor factory of Qimonda.

 

Qimonda provides DRAM products for a wide variety of applications, including in the computing, infrastructure, graphics, mobile and consumer areas. The company generated net sales of €3.61 billion in financial year 2007 and had approximately 13,500 employees worldwide.

 

The joint production plant will have a capacity of approximately 100 megawatts (MW) by the end of 2009 the companies said.

 

Silicon supply for the initial capacity has been secured with wafers from LDK Solar. The companies will receive a total of 540 (MW) solar wafers over 5 years. The prices are initially fixed for each year, but do incorporate a flexible component to reflect the general market price trend from 2011 onwards.

 

The venture company will invest approx. €70 million until September 2009. Approximately 70 percent of the financing is expected to be provided by local banks. In addition, the partners plan to apply for a funding package provided by Portuguese state authorities in accordance with European funding regulations, for which the first indications appear to be advantageous.

Centrosolar accounts for 49 percent of the equity of the venture company and will thus receive 49 percent of the production output. Centrosolar refinances its equity share by a 10 percent capital increase via a private placement. The placement is backed by a guarantee from a major shareholder.

 

Qimonda is investing 51 percent and will market its corresponding share of the production output, the company said.

 

The venture company will use the crystalline silicon technology leveraging the in-depth expertise of Qimonda in all relevant processing steps. After the ramp up phase, the solar cells will provide an electrical efficiency of more than 16 percent, the companies said.

 

Qimonda is also leveraging its experience with silicon suppliers as well as the availability of waste silicon from its DRAM operations to set up supply contracts with attractive terms.

 

SAFC Opens 5,000 Sq. Ft. Cleanroom in Wisconsin

SAFC Hitech(TM), a focus area within SAFC(R), a member of the Sigma-Aldrich Group (Nasdaq: SIAL), today underlined its commitment to the electronic materials markets with the opening of a $9 million state-of-the-art cleanroom located on the Company's Sheboygan Falls, Wisconsin campus. The 5,000 square foot facility consists of an ISO Class 4 cleanroom, a distillation suite and office space.

 

The new facility, which became fully operational in late April 2008, provides in-house trace metals analysis and the capability to clean and fill containers in a tightly-controlled environment. The Sheboygan campus was selected as the site for the new cleanroom as it already provides large-scale manufacturing of products for the material science industry for SAFC, which supports the silicon semiconductor, compound semiconductor and performance materials markets.

 

The extension of the Sheboygan campus enables SAFC Hitech to produce, package and analyze its products in one location, completing the total supply chain, eliminating the need to use outside facilities and ensuring customers an uninterrupted supply of the highest quality materials required for advanced semiconductor manufacturing.

 

The filling, packaging, and analysis facility was custom-designed from the ground up to ensure purity in packaging of ampoules and tanks. Several innovative techniques eliminate as many sources of metallic contamination as possible: walls and ceilings formed from welded PVC, a custom vacuum oven to dry containers, and sophisticated purge/fill systems inside of custom UHPA hoods. A state-of-the-art mass-spectrometer is used to confirm that individual metal contamination levels are kept in the sub-parts-per-trillion range.

 

Looking ahead, Geoff Irvine, Director, Commercial Development & Marketing, SAFC Hitech, believes the Sheboygan facility can act as a blueprint for future expansion in overseas markets. "In 2007 we announced long-term plans for the expansion of our manufacturing footprint in both China and South Korea," Irvine says. "We expect to be able to use the construction and operational experiences gained from Sheboygan and apply it to future, similar developments serving other markets, thereby expanding our global presence using tried and tested methodologies."

 

StratEdge Gets ISO Certification

StratEdge, leader in the design and production of semiconductor packages for microwave, millimeter wave, and high speed digital devices, announces that it has been certified for ISO 9001:2000 at its new facility which opened in November 2007. It’s an ISO 9001:2000 requirement to pass periodic audits by external auditors to maintain certification. Since being ISO certified originally in 1998, StratEdge has consistently passed such audits and maintained its certification. Achieving certification indicates that StratEdge meets specific requirements for a quality management system. It demonstrates StratEdge’s ability to consistently provide product that meets customer and applicable regulatory requirements and aims to enhance customer satisfaction.

 

The new StratEdge facility serves as its international headquarters as well as its R&D, design, manufacturing, and assembly and test services center. It contains 12,268 square feet and includes a Class 100 manufacturing area for precision bare die assembly of StratEdge’s high performance packages that operate at frequencies from DC to over 50 GHz. The main manufacturing lines are thick film printing, furnace operations, plating, and microelectronics assembly which include component attachment, wire bonding, and electrical test. StratEdge manufactures all its packages and provides all assembly services at its new facility in San Diego, California.

 

StratEdge, founded in 1992, designs, manufactures, and provides test and assembly services for a complete line of high performance semiconductor packages operating from DC to 50+ GHz for the high speed digital (OC-48, OC-192, OC-768), mixed signal, broadband wireless, satellite, point-to-point/multipoint, VSAT, and test and measurement industries, as well as aerospace stripline filters. StratEdge offers ceramic, low cost molded ceramic and metal packages. All packages are lead-free and most meet RoHS and WEEE standards.

 

SOLAR

 

Swiss Oerlikon and Others Build Solar Facilities in Singapore

Singapore’s sunrise solar industry welcomed a new player yesterday, as Swiss firm Oerlikon Solar unveiled plans for a $39 million facility that would serve as its Asia headquarters.

 

The Switzerland-listed company, which makes equipment for the solar industry, is recruiting 100 staff this year, with plans to expand its workforce by 50 per cent in the coming years.

The centre - a first of its kind for Singapore - is expected to be operational by early next year, although Oerlikon has yet to pick a location. It will be a multi-purpose facility for manufacturing; research and development; sales; and customer services, said Oerlikon's chief executive, Ms Jeannine Sargent.

 

Asia will be a key growing market for solar panel production in the next few years, and Oerlikon's Singapore headquarters will cater to this demand, added Ms Sargent.

 

Asia's capacity for solar panels produced will grow to more than 4 gigawatt-peak (GWp) by 2010, which is more than double that of the United States and Europe,' she said.

 

The firm is the latest in a line of global solar industry players to set up shop in the Republic. Last month, leading Norway solar firm Renewable Energy Corporation picked Singapore over 200 locations to host a major $6.3 billion solar manufacturing plant — the world's largest.

 

German solar cell manufacturer SolarWorld set up its regional headquarters in Singapore last April, while German solar firm Conergy started a local office in September.

 

Oerlikon specializes in providing technology solutions for thin-film solar technology - a next-generation technology that needs less material and is more energy-efficient than conventional methods. It is used, for example, in building integrated photovoltaics - solar panels integrated into a building's facade - due to its slimmer size and look.

 

Ms Sargent said the thin-film solar industry's annual growth rate for 2005 to 2015 was expected to be a startling 45.7 percent.

 

McIlvaine Company,

Northfield, IL 60093-2743

Tel:  847-784-0012; Fax:  847-784-0061;

E-mail:  editor@mcilvainecompany.com;

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