Contract chipmaker receives approval for China expansion

By Lisa Wang  /  Staff reporter

Thu, Dec 20, 2012 - Page 13

United Microelectronics Co (UMC, 聯電), the world’s No. 2 contract chipmaker, yesterday obtained its long-awaited approval from the government to buy about a 52 percent stake in Chinese chipmaker HeJian Technology (Suzhou) Co Ltd (和艦科技) for US$157 million.

The Investment Commission yesterday gave the go-ahead to seven China-bound investment projects totaling US$780 million including the one from UMC, a US$56 million venture from Hon Hai Precision Industry Co Ltd (鴻海精密) and a US$317 million project by Bank SinoPac (永豐銀行) to set up a Chinese subsidiary.

The approval will help UMC obtain a “manufacturing base in China,” UMC spokesman Liu Chi-tung (劉啟東) said by telephone.

“We will continue to increase our holdings of HeJian to 100 percent as planned,” Liu said.

The move would see UMC’s holdings in HeJian increase to 87.59 percent after obtaining 35.7 percent of the Chinese chipmaker in an earlier approval.

UMC would be able to make 8-inch wafers and solar cells through HeJian, the Investment Commission said in a statement released yesterday.

UMC currently operates seven 8-inch wafer factories, two 12-inch factories and one 6-inch factory.

The commission yesterday also approved six investment projects from overseas, totaling US$433 million.