Powerchip Semiconductor Corp (
The new entity will invest between NT$450 billion and NT$500 billion (US$13.93 billion-US$15.48 billion) in building four 300mm plants for manufacturing dynamic random access memory (DRAM) chips with monthly capacity reaching 24,000 wafers over the next five years.
The planned investment will be the largest foreign investment on a single project that Taiwan has seen in years, according to the Ministry of Economic Affairs' statistics. In the first 10 months of the year, foreign investment totaled US$1.23 billion, the ministry's data showed.
"The alliance between Elpida and Powerchip will help the two to collectively strive for the number-one position in the DRAM industry within the next three years," Elpida executive officer Yukio Sakamoto told a press briefing in Taipei.
In the initial stage, the two companies plan to pool NT$40 billion to invest in the new venture.
The first plant, which is under construction and originally owned by Powerchip only, is scheduled to start mass production next August.
"The cooperation will hasten Powerchip's capacity expansion and secure technology resources," Powerchip chairman Frank Huang (
The agreement would give the Taiwanese company the right to half of the venture's output.
Elpida and Powerchip will jointly develop advanced DRAM manufacturing technologies using 70-nanometer process technology first and more advanced 50-nanometer process technology in the future with the specific aim of producing low-cost chips.
To raise funds for future equipment and facilities, Huang said the new entity (which has no English name yet) would arrange to list public shares in Taiwan after it starts to make profits, which could be two years from now.
The latest cooperation between the two is an extension of a long-term partnership, as Elpida has been transferring advanced technologies to Powerchip in exchange for capacity.
Stronger growth in the DRAM market recently has prompted Merrill Lynch to raise its growth forecast for DRAM and NAND flash sales to 28 percent for this year and 19 percent for next year, compared with its earlier estimate of 21 percent and 16 percent, respectively.
"I believe the deal will have a relatively positive impact on Powerchip as it will obtain much-needed advanced technologies, which is very important [for the company to make cost-efficient chips]," said Crystal Lee (
In addition, Powerchip's strategic alliance with Elpida would reduce the potential threat from China's Semiconductor Manufacturing International Corp (SMIC,
SMIC, China's biggest chipmaker, competed with Powerchip for Elpida's partnership after Japan's sole DRAM maker said it planned to build new plants overseas. Its only factory, in Hiroshima, already runs at full capacity.
Elpida chose the Taiwanese company because "Powerchip can make DRAM chips at the lowest cost," which is essential for chipmakers to survive in the highly volatile DRAM industry, Sakamoto said.
The Tokyo-based chipmaker does not have further overseas investment plans in the near future, Sakamoto said.
Additional reporting by Jessie Ho
SCHEDULE: The delegation is due to meet with President Tsai Ing-wen this morning and witness the signing of an MOU on bilateral health cooperation in the afternoon US Secretary of Health and Human Services (HHS) Alex Azar yesterday arrived in Taipei aboard a US government plane at the head of a delegation that is the highest-level visit by a US official since Washington switched diplomatic recognition to China in 1979. Azar’s flight landed at Taipei International Airport (Songshan airport) at 4:48pm, nearly one hour earlier than scheduled, the Ministry of Foreign Affairs said. The apron where it landed is reserved for military aircraft, the Songshan Air Force Base Command said. The members of Azar’s delegation included HHS Assistant Secretary for Preparedness and Response Robert Kadlec, HHS Chief of Staff Brian
CHINESE FIGHTERS: Beijing marked the US Cabinet member’s visit by briefly sending two warplanes across the median line of the Taiwan Strait yesterday morning President Tsai Ing-wen (蔡英文) yesterday met with US Secretary of Health and Human Services Alex Azar in the highest-level official meeting between the two nations since 1979. “It is a true honor to be here to convey a message of strong support and friendship from [US] President [Donald] Trump to Taiwan,” Azar said during the open portion of his courtesy call to the Presidential Office, which was streamed live online before Tsai and Azar held a closed-door meeting. “Taiwan’s response to COVID-19 has been among the most successful in the world, and that is a tribute to the open, transparent,
‘CROSS-STRAIT CONSIDERATIONS’: Groups said that the Ministry of Education’s policies excluded Chinese and students should not be blocked over political issues The Taiwan International Student Movement yesterday said it would protest today outside the Ministry of Education in Taipei against a policy that excludes some Chinese students from returning to Taiwan amid the COVID-19 pandemic. Since June 17, the ministry has allowed foreign students from 19 “low risk” and “medium-low risk” countries and regions to enter Taiwan. On July 22, it announced that it was relaxing restrictions to include students from all countries and regions who are graduating this semester and on Wednesday it further expanded entry to students enrolled in degree programs. A letter sent by the ministry on Wednesday to universities did
PARTNERSHIP AND LEARNING: A Princeton University health policy researcher said that the nation would be a ‘treasure trove’ of information for the US health chief US Secretary of Health and Human Services Alex Azar on Friday said he wants to learn about Taiwan’s “incredibly effective” response to COVID-19, even though the nation did things that the US has fumbled, such as having a unified strategy and citizens willing to wear masks. Azar leads a US delegation arriving today for a three-day visit to Taiwan. They are to meet with President Tsai Ing-wen (蔡英文) and health system leaders, and Azar is to give a speech to public health graduates. “The message of this trip is about Taiwan,” Azar said in an interview, deflecting a question about China.