MUNICH, Germany -- Infineon Technologies AG and China-Singapore Suzhou Industrial Park Venture Co. Ltd. (CSCV), of Suzhou, China, are setting up a memory chip assembly and test joint venture company to be located at Suzhou Industrial Park 80-kilometer (about 50 miles) west of Shanghai.
Infineon expects about $1 billion to be invested in the facility over ten years, which, once completed, should be able to package test one billion chips a year, Infineon said. Infineon holds 72.5 percent of the shares of the joint venture and CSVC the remaining 27.5 percent, Infineon said.
No name was given for the joint venture, which is intended to service the needs of Infineon's front-end joint venture and licensed partners in southeast Asia, including cooperation ventures with Winbond, SMIC and Nanya.
Infineon plans to contribute about $240 million over the next five years as equity. CSVC is to contribute US$90 million, Infineon said.
The initial tranche payments are sufficient for the first stages of development including construction of the building, facilities, infrastructure and the installation of initial equipment, Infineon indicated, with the joint venture itself is expected to finance the purchase and installation of additional equipment to bring the site up to full production and an employment level of about 1000 people.
"With this partnership we are systematically expanding our presence in the future market of China, we will gain access to new customers, and aim to capture a 40 percent share of the market for memory products in China," said Ulrich Schumacher, president and chief executive officer of Infineon, in a statement. "Overall, we intend to secure in China a place among the top four in the microelectronics business with a market share of more than 10 percent within the next five years. By then we will have about 3,300 employees in China," he added.
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, Infineon said. Volume production of packaged chips is slated to commence in early 2005.