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Elpida, Powerchip join efforts for DRAM fab

Posted: 11 Dec 2006 ?? ?Print Version ?Bookmark and Share

Keywords:DRAM? Elpida? DRAM? Powerchip? memory device?

Elpida Memory Inc. and Powerchip Semiconductor Corp. (PSC) will form a memory joint venture that will focus on the cutthroat commodity DRAM market.

The two companies agreed to establish a DRAM joint venture fab in Taichung, Taiwan, which is expected to reach a monthly capacity of 240,000 12-inch wafers. The agreement includes joint R&D on advanced process technology beginning at 50nm.

The joint venture, which combines the No. 5 (Elpida) and No. 7 memory makers, will focus on the highly competitive commodity DRAM market for PCs. Elpida has been focusing on DRAMs for digital consumer products and cellphones and relied on foundries such as PSC and Semiconductor Manufacturing International Corp. for commodity DRAMs.

The joint venture signals a change in Elpida's strategy, committing it to competing in the commodity DRAM market. "To expand our DRAM business, it is essential to commit to commodity DRAMs production," said Shuichi Otsuka, Elpida's director and COO. "We expect that we can secure profit from non-PC use DRAMs produced at Hiroshima fab even if the commodity DRAM price fluctuates," he added. Elpida reported 15.4 percent increase in operating margins in its second quarter ended in September.

The joint venture will use of PSC's third 12-inch fab that has been under construction since March.

Using PSC's 12-inch fab, "we can start production quickly," said Otsuka said.

The partners will respectively invest about $700 million in the first phase of the partnership to build a 12-inch line with a monthly capacity of 30,000 wafers. The fab is scheduled to begin operations in the fourth quarter of 2007.

The 196,000m? site in Taichung will house four fabs, each with a monthly capacity of 60,000 wafers. "We believe [full] 240,000-wafer capacity should be reached within four to five years," said PSC President Brian Shieh.

Ohtsuka said total investment needed to build the four fabs will be $13.9 billion.

- Yoshiko Hara
EE Times

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