Thu, Mar 28, 2002 - Page 17 News List

Chinese chip firm hopeful for sale

BLOOMERG , SHANGHAI

Shanghai Belling Corp (上海貝嶺), one of China's first chipmakers, may buy equipment from Texas Instruments Inc and Conexant Systems Inc, should talks with United Microelectronics Corp (聯電) fail.

A Chinese-language newspaper reported yesterday that UMC, the nation's second-largest made-to-order chipmaker, called off the sale because it failed to get a permit to export the equipment, and because rising demand is boosting its own needs.

"It would be ideal if we could complete this deal," said Yu Chunhao, a Shanghai Belling official, "because UMC has expertise that would benefit our development."

UMC hasn't told Belling that it's canceled the sale, Yu said.

Belling and Shanghai Zhangjiang Hi-Tech Park Development Co need equipment for a new US$340 million plant in Shanghai that will make eight-inch silicon wafers. China's market for semiconductors is the world's fastest growing and is now worth US$10 billion a year.

While it would prefer to tie up with UMC for reasons of experience and price, Belling has also held talks to give US-based Texas Instruments and Conexant, Yu said. UMC spokesman Alex Hinnawi refused to comment.

Construction has begun at the plant, on a 80,000m2 site in the Zhangjiang High-Tech Park (張江高科技園區) in Pudong district. The factory replaces an previously planned plant that would have made six-inch silicon wafers.

The plant will be able to make 0.25-micron wafers, compared with the 1.2 micron wafers it now makes at its four-inch wafer plant.

The chip-making equipment is expected to be installed in September and trial production will begin in December, Yu said.

Production is likely to start in March 2003 and will produce 10,000 wafers monthly, Yu said.

Belling employs 594 people and serves customers including Siemens AG and NEC Corp.

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