HSINCHU, Taiwan -- Taiwan's UMC Group here is said to be in discussions to acquire one of its competitors, Worldwide Semiconductor Manufacturing Co.
It is a move that -- coupled with a separate deal to assume as much as one-fifth of Hitachi Ltd.'s wafer production (see today's story) -- could make UMC the world's largest pure-play foundry.
According to sources close to the discussions, Hsinchu-based UMC is pursuing a deal to acquire WSMC, a relatively new foundry concern that has been ramping up production at its first fab since late last year.
WSMC, also located in Hsinchu, is partly owned by Taiwanese IC maker Winbond Electronics Corp. and obtained its submicron technology from Toshiba Corp., for which it makes chips on a contract basis.
The talks have yet to be finalized, nor has a sale price been disclosed. But if a deal were to be completed, UMC's total wafer output would approach -- or even surpass -- that of its main competitor, Taiwan Semiconductor Manufacturing Co. (TSMC), according to analysts.
John Hsuan, chief executive of UMC, declined to comment on the reports, but he did say that the company wants to increase its production capacity and is looking for acquisition candidates. "Some people think [acquiring WSMC] is a good idea, but we cannot say anything now," Hsuan told EBN in an interview.
WSMC also refused to comment. "There are many rumors circulating and I cannot confirm them," said Chang Bing-hun, a vice president at the company.