TOKYO--Sharp Corp. today announced plans to invest 7 billion yen ($65 million) in Nippon Foundry Inc., a Japanese subsidiary of Taiwan's United Microelectronics Corp. (UMC). Sharp said it was making the investment in the silicon foundry operation as part of a long-term agreement aimed at meeting its "fast-rising" demand for flash memories and other advanced chip products.
The initial capacity agreement is for 6,000 eight-inch wafers per month, and the volume is expected to grow to 10,000 wafers per month by 2002, according to Sharp. Production of wafers will take place at NFI's Tateyama, Chiba facility, and it is expected to begin in the second half of 2001.
Sharp said the 7 billion yen investment is in addition to its own spending plans on its own manufacturing facilities. Sharp has also entered into a foundry alliance with Malaysian startup 1st Silicon (Malaysia) Sdn. Bhd. in Kuching. During the summer, the two company announced an expansion of Sharp's agreement for processed wafers from 1st Silicon's new 8-inch fab to $300 million over the next few years (see June 29 story). It was not immediately clear how the new foundry agreement with UMC will impact 1st Silicon.
The Nippon Foundry subsidiary has been converting itself from DRAM products to logic production for foundry customers since UMC purchased majority ownership in 1998 (see Sept. 29, 1998, story). With Sharp's new investment, the facility will be upgraded from the current planned capacity of 34,000 eight-inch wafers per month to 40,000 wafers per month, said company officials. The total required investment for NFI's expansion is 26.0 billion yen ($238 million).
Under the new foundry agreement, Sharp will gain access to 0.18-micron and below process technologies from UMC, which is based in Hsinchu, Taiwan.