Thu, Jul 01, 2004 - Page 10 News List

Inotera Memories venture opens

BIG BOOST Infineon Technologies and Nanya Technologies will spend US$2.2 billion on producing cutting-edge 300mm wafers as part of the first phase of the investment


Inotera Memories Inc (華亞半導體), a 50-50 joint chipmaking venture of Infineon Technologies AG and Nanya Technology Corp (南亞科技), will give a boost to its parent companies' market share next year, a company executive said during its opening ceremony yesterday.

The joint venture, into which the two memory chipmakers will pour a total of US$2.2 billion by the end of next year, aims to produce 24,000 cutting-edge 300mm wafers per month in the first phase investment running to the end of this year, said Inotera president Charles Kau (高啟全).

"With the fab's capacity to be expanded to 54,000 units a month next year, Inotera's shipment will take up 10 percent of the global memory chip market [for its parent companies]," Kau said.

Infineon, the world's No. 4 dynamic random access memory (DRAM) maker, held a 14.9 percent share of the global DRAM market in the first quarter of this year, according to researcher iSupply Corp. Nanya Technology captured 4.6 percent.

Easing concerns that Infineon might walk away from the DRAM sector and sever ties with its Taiwanese partner, Infineon vice president Peter Pauer stressed that "Inotera is one of the most important investments for Infineon in Asia, and demonstrates the company's commitment to its Asian partnership strategy."

But Bauer did not respond to a question whether Infineon will extend the partnership with Nanya Technology to a planned second 300mm wafer fab.

Inotera is scheduled to launch initial pubic offerings on the local equity market in 2006 at the earliest, Kau said, without elaborating.

Analysts said the timing for Nanya Technology to operate an advanced 300mm wafer plant forInotera appears relatively late.

Nanya Technology, the nation's No.1 DRAM maker, may not be able to reap the fruits of the investments in time as its local rivals did during the industry upturn, they added.

"But I believe it will regain its market position next year after Inotera's cost-efficient 300mm wafer plant ramps up," said Paul Tsai (蔡昀達), who oversees a NT$500 million fund for International Investment Trust Co (國際投信).

In the second quarter, Wang Bou-li (王博立) of Polaris Securities Co (寶來證券) expects smaller local rival Powerchip Semiconductor Corp (力晶半導體) to continue to take the lead among the nation's three major DRAM players in terms of profits.

Powerchip is expected to earn NT$5.5 billion before taxes in the three months ending last month, while Nanya Technology will lag behind by earning NT$2.1 billion, Wang projected. He predicted that ProMOS Technologies Inc (茂德科技) will earn NT$2.55 billion.

Nanya Technology spokesman Pai Pei-lin (白培霖) said the contract price of DRAM chips will have a big chance to bounce back in the second half of this month.

"But the demand will be very strong in the second half of the year as corporate information technology spending is improving," Pai said.

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