Wed, Aug 08, 2007 - Page 12 News List

ProMOS inks agreement with Toppan

DIVERSIFICATION Aided by Toppan's technology, ProMOS hopes to use its old fabs to produce CMOS image sensors and lower its exposure to the volatile DRAM market

By Lisa Wang  /  STAFF REPORTER

ProMOS Technologies Inc (茂德科技), the nation's No. 3 computer memory chipmaker, yesterday said it had inked an agreement for the transfer of Toppan Printing Co Ltd's technology in manufacturing CMOS image sensors.

The agreement is part of ProMOS' efforts to diversify away from the highly volatile memory industry by revitalizing older facilities and equipment for use in manufacturing other products, Ben Tseng (曾邦助), spokesman for PROMOS, said by telephone.

"CMOS image sensors are mostly used in consumer electronics, which is a relatively stable market in terms of pricing," Tseng said.

CMOS, or complementary metal-oxide semiconductor technology is used to produce image sensors. The company plans to manufacture CMOS image sensors mainly for use in mobile phones and other products such as digital cameras.

"This new product will provide a way for us to hedge against the volatile DRAM market," Tseng said.

DRAM prices had fallen 60 percent during the first six months of the year, Tseng said.

Under the agreement, Tokyo-based Toppan Printing would license its process technologies for on-chip color filters and micro lenses, ProMOS said in a statement yesterday.

In 2004, Toppan Printing formed a CMOS image sensor manufacturing venture with China's biggest chipmaker, Semiconductor Manufacturing International Corp (中芯) in Shanghai.

ProMOS expects to start supplying CMOS sensors for customers on a contract basis in the first quarter of next year at the earliest, Tseng said.

The chipmaker plans to make CMOS sensors at an old 12-inch (300mm) plant in Hsinchu, ProMOS said, joining bigger local rivals such as Powerchip Semiconductor Corp (力晶半導體) in making products other than DRAM chips at less cost-competitive factories.

He declined to reveal the amount of additional investment needed to upgrade the facility to accommodate CMOS sensor production.

ProMOS has said it plans to spend US$1.88 billion for new facilities and equipment this year.

The company is scheduled to release its second-quarter results on Friday. The company may fall into the red because of drastic price falls.

Sales for the first seven months jumped 26 percent to NT$31.3 billion (US$951 million) from a year ago, ProMOS said early this month.

Credit Suisse last month upgraded ProMOS and Powerchip to "outperform" from "neutral," citing improving industrial prospects on disciplined capacity expansion.

The stock price of ProMOS slid 0.79 percent to NT$12.5 yesterday, slightly better than the benchmark TAIEX, which fell 0.9 percent.

Shares of the nation's two biggest DRAM suppliers, Powerchip and Nanya Technology Corp (南亞科技), dropped 0.55 percent and 0.75 percent respectively.

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