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IDT to sell Malaysian facility to Singapore's AIT

Posted: 12 Oct 2006 ?? ?Print Version ?Bookmark and Share

Keywords:Integrated Device Technology? IDT? backend facilities? Advanced Interconnect Technologies? AIT?

Integrated Device Technology Inc. (IDT) announced early this week (October 10) its plans to sell its Malaysian backend facility to Singapore's Advanced Interconnect Technologies Inc. (AIT). This move will impact 300 jobs at IDT.

As part of this agreement, AIT will purchase IDT's assembly operations in Penang, Malaysia. IDT is one of AIT's largest customers for backend services.

According to the multi-million dollar agreement, AIT will gradually transfer all assembly manufacturing from Penang to its facility in Batam, Indonesia. AIT is currently expanding its operations in Batam to meet the growing demand from existing and new customers for full turnkey assembly and test services.

IDT's Penang facility will remain open following the transition of assembly services to AIT, according to a filing in the U.S. Securities and Exchange Commission (SEC). The U.S. chip maker expects to continue its testing operations and other support activities at the Penang facility once the transition is complete.

IDT anticipates completing the transfer of all assembly work currently performed at the Penang facility to AIT within the next year. IDT will also transfer certain of its assembly equipment to AIT.

''The activities contemplated by this plan are consistent with the company's long-term strategy of profitability and cost-reduction,'' according to IDT. ''The company anticipates that this outsourcing plan will reduce ongoing operating expenses.''

Last year, IDT closed its IC assembly and test facility in Manila, the Philippines, a move that impacted about 750 jobs.

- Mark LaPedus
EE Times

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