Infineon Technologies aims to sell off two of its smaller non-core businesses by the end of its current financial year. The company, which reported strong results for the year ended 30th September on the back of big rises in its memory and communications IC operations, is looking to follow the disposal of its audiovisual IC business to Micronas.
Ulrich Schumacher, president and CEO of Infineon, said: Our optocouplers business has nothing to do with our strategic target segments. We also have 49% in the Opto joint venture with Osram for LEDs. We will divest that.
"The negotiations are running. We hope to close in the next quarters and definitely by next fiscal year.
"We will lose about Euro800m to Euro900m of revenue but will raise an attractive amount of capital."
Infineon has committed about 30% of its revenues to capital expenditure as the company brings up additional capacity, particularly for logic products.
"In non-DRAM segments, we are almost sold out. With our 300mm module, we are handing over our fast-growing wafer capacity to logic. And logic is eating fast into 8in lines," said Schumacher.
At Dresden, which will house the 300mm line, Schumacher said: "85% of the equipment is in place. We expect to start production in the middle of 2001."
Despite the recent falls in DRAM prices, Schumacher was confident that prices would stabilise after the company's first quarter of fiscal 2001.
To protect itself against the worst fluctuations in the DRAM market, Infineon has decided to switch memory production to higher density devices for workstations, servers and high-end PCs.
"We already have 50% of our DRAM business in non-PC sectors," said Schumacher.
Although all of its products have been migrated to a 0.17um process, leading to a 70% increase in productivity, COO Andreas von Zitzewitz said that 64Mbit production would reduce to almost zero from its current 50% share of the company's DRAM business.
Production would rise in 128Mbit and the new 256Mbit devices to sustain the company's 10 to 11% market share. Infineon will continue to make some 64Mbit devices that had been designated as long-life products for non-PC OEMs, said von Zitzewitz.
"We aim to maximise 256Mbit sales as far possible but 128Mbit will have the higher market share," added von Zitzewitz.
Schumacher said the productivity gains obtained with the move to 0.17um would not be repeated in the 2001 financial year.
"For the next nine to ten months, we will live out of 0.17um by improving yields. We will see no productivity gains beyond 30% and probably a little less."
After that point, the intention is to shrink geometries for memory products.
Von Zitzewitz said: "Our plan is to qualify 0.14um by the end of 2001 and then do the ramp."