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Globalfoundries closes P3 deal, Powerchip ends DRAM run

Posted: 07 Feb 2013 ?? ?Print Version ?Bookmark and Share

Keywords:DRAM? P3 Plant? PC DRAM wafer production? 30nm technology?

According to a recent report by TrendForce, GlobalFoundries has purchased the majority of the equipment at Powerchips' P3 Plant. The purchase finally ends delays to the bidding for Powerchip's P3 plant. Clearance of the inventory will soon follow. For any equipment that remains unsold, Powerchip's creditor banks will either seek additional buyers or attempt to allocate them to the existing P1 and P2 facilities. Further discussions between Powerchip and its banks are expected to take place in the days following the factory clear-out.

When Powerchip purchased P3 from Macronix for $5.3B NTD during 2006, it began to use the 90nm manufacturing process and gradually transformed the plant into a major DRAM production facility. As time passed, the company would go on to buy three additional manufacturing equipment, upgrade to the 30nm technology, and expand its capacity to around 45K.

The DRAM market, for the most part, has been in a continuous state of oversupply, as can be seen when the 2Gb prices dipped below $0.6USD last year. While 2Gb prices would eventually rally and climb to $1.3USD, Powerchip has chosen to go into the foundry business in 2H12 and decided to substantially reduce its PC DRAM wafer production. In recent periods, Powerchip actively discussed OEM service opportunities with first tiered manufacturers as a means to maintain proper production utilisation rates for P3 and to retain a portion of its capacity. As the company's debt reached $60 Billion NTD, though, the creditor banks would ultimately suggest putting P3 up for bid, in turn leaving Powerchip with about 80K worth of capacity from P1+P2. Given that the company's focus is still on the foundry business, following the removal of P3 equipment by GlobalFoundries, Powerchip is predicted to stop wafer production and permanently shut down DRAM production during 1Q13.





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