AMI Semiconductor Condenses European Fabs

August 17, 2005 by Jeff Shepard

AMI Semiconductor Inc. (AMIS, Pocatello, ID), a manufacturer of application-specific integrated circuits and structured digital products, announced plans to consolidate its European wafer fabrication operations. The company said it will close its 4-in wafer fabrication facility in Oudenaarde, Belgium, and will fold operations from that site into its existing 6-in wafer fab, also located in Oudenaarde.

"These actions, along with our previously announced, on-schedule, wafer-sort-consolidation efforts in our Manila, Philippines, facility, are examples of our ongoing commitment to improving efficiencies," said AMI President and CEO Christine King. "Customer satisfaction and quality are of paramount importance as we execute on this consolidation, and we will work closely with our customers through this transition."

The company anticipates this latest consolidation will yield a net pre-tax cost savings of approximately $1 million to $1.5 million per quarter, starting in the first quarter of 2007, by which time the restructuring is expected to be completed. The total pre-tax restructuring charge is expected to be in the range of $20 million to $25 million, which will be predominately cash. Restructuring charges to be incurred in third-quarter 2005 will be dependent upon the nature and timing of an agreement with the local workers’ council. AMI expects to take the remaining charges on a quarterly basis through the first quarter of 2007, as incurred.