Thu, Dec 04, 2014 - Page 14 News List

Powertech partnering with Micron to work in China

By Lisa Wang  /  Staff reporter

Powertech Technology Inc (力成科技), the nation’s largest memorychip tester and packager, yesterday said it has entered into a series of service supply agreements with Micron Technology Inc of the US to provide DRAM chip testing and packaging services in Xian, China.

The announcement ended year-long speculation that Micron might form a partnership with Advanced Semiconductor Engineering Inc (ASE, 日月光半導體) in China to supply chip testing and packaging services there.

In a statement issued yesterday, Powertech said it would initially invest US$70 million in creating a new DRAM entity in Xian under the partnership.

Investments would increase to about US$210 million, as the firm plans to purchase equipment for a new plant, which is to be built by Micron in a high-tech zone in Xian, Powertech said.

“Upon the completion of the new plant, Powertech will operate the assembly facility and provide Micron with assembly and packaging services for a period of several years,” the company said in the statement.

Powertech chief executive officer Tsai Du-kung (蔡篤恭) said: “Powertech is pleased to team up with Micron in developing this new assembly facility in Xian, which will also help Powertch further expand its services throughout the region.”

Rick Bunch, vice president of Micron’s backend manufacturing unit, said collaborating with Powertech would allow the US memorychip maker to enhance its worldwide integrated manufacturing operations and decrease product cycle time.

The new Chinese plant is scheduled to ramp up production in the first half of 2016.

Powertech, which counts Micron as one of its biggest clients, said DRAM chip testing and packaging services contributed 32 percent of its total revenue of NT$10.46 billion in the July-to-September quarter.

In October, the company said it planned to spend NT$10 billion on new equipment this year. As of the end of last quarter, the company booked NT$16.95 billion in cash.

Powertech shares rose 0.56 percent to NT$54.3 yesterday, underperforming the TAIEX, which rose 1.55 percent.

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