Infineon Expands IC Product Joint Venture in China

July 27, 2003 by Jeff Shepard

Infineon Technologies AG (Germany) and the China-Singapore Suzhou Industrial Park Venture Co. Ltd. (CSVC, Suzhou, China) are setting up a joint venture for the assembly and testing of memory ICs (back-end). The agreement provides for the construction of a joint facility in the Suzhou Industrial Park, 80km to the west of Shanghai. Once completed, the facility will have a maximum capacity of up to one billion chips a year. The new company will operate under the name Infineon Technologies Suzhou Co. Ltd.

The new facility will be developed in a number of stages as dictated by growth and trends in the global semiconductor market. Total planned investment in the project over the next 10 years amounts to around US$1 billion with the registered capital being US$333 million. Infineon will contribute US$241.4 million over the next five years as equity, and CSVC will contribute US$91.6 million. The initial tranches are sufficient to ensure completion of the first stages of development, including construction of the building, facilities, infrastructure and the first cost-intensive equipment.

Work on constructing the new facility is scheduled to begin in October 2003, and the site should be ready for the equipment installation by mid-2004. Volume production is slated to commence in early 2005. The joint venture company will start by producing 256Mbit devices in BGA packages.