Micron to acquire Powertech's Xi'an factory and commit to investments in China

[Daniel Nenni]

Powertech's facility in Xi'an, China, soon to be acquired by Micron. Credit: DIGITIMES

Powertech Technology Inc., one of the world's largest memory packaging and testing service providers, announced on June 16 that it has been informed by Micron Technology of the latter's decision to acquire Powertech's assets in Xi'an, China.

Powertech spokesperson told DIGITIMES Asia that Micron is acting in accordance with the terms of the agreement it entered with Powertech in 2016. The two companies agreed that Micron reserves the right to purchase Powertech's Xi'an factory after a 6-year service contract is fulfilled. After the decision to purchase the factory, they have one year to execute and complete the transactions.

"Powertech believes that it is in the best interest of both parties to accept Micron's request. On June 27, 2023, Powertech will convene an interim board of directors meeting to review the asset sale transaction," said a company spokesperson, adding that Powertech and Micron have a long-standing partnership and expect to continue to strengthen their cooperation on the basis of their existing relationship.

Micron said it will invest another CNY4.3 billion (US$602 million) in its Chinese chip-packaging plant, according to Bloomberg, despite the fact China authorities have just announced a block on its product sales to key infrastructure in China, saying that Micron had failed its network security reviews.

The assets to be acquired by Micron include equipment and assembly lines at its existing facility in Xi'an, and will also open a new production line at the site to manufacture mobile DRAM, NAND, and SSD products to strengthen the plant's packaging and testing capabilities, according to Reuters.

A separate Bloomberg report quoted Micron's post on WeChat saying that the acquisition will create 500 jobs, bringing its staffing in the country to more than 4,500.

For Powertech, the transfer of operations to Xi'an will not have any significant financial impact, and the reduction in revenue will only occur after a one-year transition period. Powertech already rebuilt and expanded its new WBGA capacity in Taiwan in 2022. In recent years, Powertech has been actively working to expand into the logic and high-end packaging markets and has made significant progress. These capacities will continue to contribute to revenue and profitability.

Micron to acquire Powertech's Xi'an factory and commit to investments in China

Powertech Technology Inc., one of the world's largest memory packaging and testing service providers, announced on June 16 that it has been informed by Micron Technology of the latter's decision to acquire Powertech's assets in Xi'an, China.

www.digitimes.com

 

[Daniel Nenni]

"Micron said it will invest another CNY4.3 billion (US$602 million) in its Chinese chip-packaging plant, according to Bloomberg, despite the fact China authorities have just announced a block on its product sales to key infrastructure in China, saying that Micron had failed its network security reviews."

Interesting. Maybe this will change their "failed security review"? And what about CHIPs ACT money? Does this disqualify Micron? So many questions....

 

[Barnsley]

Semicon really is cat and mouse game between the industry and all Govts it seems

 

[Daniel Nenni]

Semicon really is cat and mouse game between the industry and all Govts it seems

Very true, especially since the shortages due to the pandemic. It is nice to see semiconductors getting recognition as a critical building block of modern life. It is unfortunate though that semiconductors are now a political tool. Politics really is a dirty business and now semiconductors are getting dirty by association.

 

[Daniel Nenni]

Micron Technology Inc. is close to an agreement to commit at least $1 billion toward setting up a semiconductor packaging factory in India, according to people with knowledge of the matter, a move to further diversify its geographic footprint at a time of US tensions with China.

The amount of money committed could go as high as $2 billion, one of the people said. The details could change as discussions are in progress, and there’s no guarantee an agreement will be finalized.

The deal would mark a win for Modi’s ambitious “Make in India” plans, while offering Washington an opportunity to strengthen key supply chains outside of China. Removing barriers to technological trade between the two countries is a key part of Modi’s state visit, US National Security Adviser Jake Sullivan said in New Delhi on Tuesday.

The Indian investment would follow a Chinese ban on the use of Micron chips in what Beijing called critical infrastructure, a move that cast uncertainty over the status of US chipmakers in the world’s largest semiconductor market. On Friday, Micron pledged to invest $600 million more in its Chinese plant to create jobs and support the local market.

India’s Technology Ministry and Ministry of External Affairs didn’t respond to requests for comment, while a representative for Micron declined to comment.

The US is pushing to diversify advanced chipmaking as growing Chinese tensions spur concerns about the world’s reliance on Asian manufacturing centers such as Taiwan. Micron, the largest American memory chipmaker, also secured financial support for a $3.6 billion next-generation plant it aims to establish in Japan.

Modi starts his first formal state visit June 21, with President Joe Biden hosting him for a banquet the following day. The Indian leader will also address the US Congress. Modi has pledged $10 billion to woo chipmakers to India, promising his administration will bear half the cost of setting up all semiconductor sites.

The Business Standard newspaper had previously reported Micron was set to get Indian government approval for a $1 billion assembly and packaging facility in India.

Micron nears $1 billion investment in India's chip packaging plant

Micron Technology is in discussions to establish a semiconductor packaging factory in India worth at least $1bn, reported Bloomberg, citing sources. The move is to expand the company's global footprint as trade tensions rise between China and the US. The company could commit as much as $2bn to...

economictimes.indiatimes.com