Micron Technology Inc has signed a letter of intent to buy a fabrication site in Taiwan from Powerchip Semiconductor Manufacturing Corp (力積電) for US$1.8 billion to expand its production of memory chips.
Micron would take control of the P5 site in Miaoli County’s Tongluo Township (銅鑼) and plans to ramp up DRAM production in phases after the transaction closes in the second quarter, the company said in a statement on Saturday.
The acquisition includes an existing 12 inch fab cleanroom of 27,871m2 and would further position Micron to address growing global demand for memory solutions, the company said.
Photo: AFP
Micron expects the transaction to contribute to meaningful DRAM wafer output in the second half of next year, it said.
The companies would also partner on Micron’s post-wafer assembly processing and to support Powerchip in its legacy DRAM portfolio, it added.
“This strategic acquisition of an existing cleanroom complements our current Taiwan operations and will enable Micron to increase production and better serve our customers in a market where demand continues to outpace supply,” Micron executive vice president for global operations Manish Bhatia said in the statement. “The Tongluo fab’s close proximity to Micron’s Taichung site will enable synergies across our Taiwan operations.”
The deal would see the two companies establish a long-term foundry relationship for advanced DRAM packaging, Powerchip said in a separate statement.
Micron would also assist Powerchip in enhancing its existing specialty DRAM process technologies at the P3 site in Hsinchu County, it said.
Through the deal, Powerchip aims to strengthen its financial structure, it added.
“Amid the global recovery of the memory market, the company plans to integrate advanced packaging technologies and materials — such as 3D wafer-on-wafer and interposers — to pivot into a key player within the AI supply chain,” Powerchip said.
The investment is part of Micron’s global expansion as it seeks to meet continued demand for memory chips. The Boise, Idaho-based company, which makes most of its chips at facilities in Asia, on Friday held a groundbreaking ceremony for a new plant outside Syracuse, New York, having promised last year to invest as much as US$200 billion in the US.
Micron competes with South Korea-based Samsung Electronics Co and SK Hynix Inc in the market for high-bandwidth memory chips — a crucial component in the data center processors powering the artificial intelligence (AI) boom. Demand for the components has skyrocketed due to AI data center needs, and the three companies have warned in the past few months of limited supply.
Additional reporting by staff writer
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