United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks.
The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement.
The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said.
Photo courtesy of United Microelectronics Corp
The new fab is to produce chips used in premium smartphone displays, power-efficient memory chips for Internet of Things devices and next-generation connectivity chips, it said.
Together with the existing 12-inch factory, UMC would have a combined capacity of 1 million wafers in Singapore after the new fab becomes operational next year, the chipmaker said.
UMC copresident S.C. Chien (簡山傑) said in the statement that the new fab enhances the chipmaker’s ability to meet demand and enhance its supply chain resilience.
Photo courtesy of United Microelectronics Corp
The capacity expansion plan is expected to create approximately 700 jobs over the next few years, including engineers for process and equipment, as well as research and development.
Separately, UMC said it has no merger-and-acquisition deals on the table at the moment, dismissing a report from online news site Nikkei Asia that the company is restarting a merger assessment with US contract chipmaker GlobalFoundries Inc.
More than 10 years ago, the contract chipmakers considered a merger and consolidation, but the idea was abandoned. UMC and GlobalFoundries both specialize in mature chip production.
In reporting that the two chipmakers were exploring a merger, Nikkei Asia said they were likely to create a bigger US-based company that would have broad production footprints across Asia, the US and Europe.
The report said the merger is expected to help the US gain access to mature chips amid escalating tensions across the Taiwan Strait.
The combination of the two companies would create an entity with a larger market share of 9.3 percent, surpassing Samsung Electronics Inc’s 9.1 percent, if they went ahead with the deal, Taipei-based researcher TrendForce Corp’s (集邦科技) data showed.
GlobalFoundries ranked as the world’s No.5 contract chipmaker after UMC. The San Jose, California-based chipmaker posted a loss of US$26 million last year, while UMC reported a net profit of NT$47.21 billion (US$1.42 billion).
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