Advanced Semiconductor Engineering Inc (ASE, 日月光半導體), the world’s biggest chip tester and packager, yesterday said that it plans to invest US$70.5 million in a joint venture with Qualcomm Inc to develop and produce system-in-a-package (SiP) modules in Brazil.
The modules would be used in Internet of Things (IoT) devices and smartphones, ASE said in a company filing with the Taiwan Stock Exchange.
The investment will be made in three stages via its Shanghai-based subsidiary, Universal Scientific Industrial (Shanghai) Co Ltd (USI, 環旭電子), ASE said in the filing.
In a joint statement released yesterday, Qualcomm said its fully owned subsidiary, Qualcomm Technologies Inc, has signed an agreement with USI to form the joint venture.
The agreement formalizes the non-binding memorandum of understanding signed by the two parties in March last year with the Ministry of Science, Technology, Innovation and Communications, the Ministry of Industry, Foreign Trade and Services and Investe Sao Paulo, representing the Sao Paulo State Government, the statement said.
The new entity would focus on the installation of a semiconductor module facility in Sao Paulo dedicated to the design, development and fabrication of modules and components for smartphones and IoT devices in Brazil.
The flagship products of the joint venture would be a line of SiP modules powered by Qualcomm’s chipsets, the statement said.
The modules would include the radio frequency and digital components for smartphones and IoT devices, it said.
“Brazil is the largest economy in Latin America with a significant growth potential for integrated modules. USI will be utilizing the technological competence of its parent company, ASE, to help build up the semiconductor cluster in Brazil and Latin America,” USI president C.Y. Wei (魏鎮炎) said in the statement.
“We are excited to be a part of this joint venture that could help boost local employment in the next five years,” he said.
The joint venture is likely to be set up in the state of Sao Paulo. Assuming successful formation, the joint venture is expected to start manufacturing the modules in 2020.
ASE’s SiP business last year grew 42 percent annually, its best growth performance yet, thanks to the company’s efforts to optimize product portfolio.
Shares of ASE plunged 3.3 percent to close at NT$39.5 yesterday as the TAIEX tumbled 4.95 percent following Wall Street’s dramatic fall of 4.6 percent.
A total of 29.60 million ASE shares were traded during the session.
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