Microchip Technology Inc. today said it will acquire a semiconductor fab complex owned by Matsushita Semiconductor Corp. of America in Puyallup, Wash., for an undisclosed sum.
The facility will be used to increase Microchip's capacity to manufacture field-programmable microcontrollers, serial EEPROMs, and microperipheral products.
Microchip, which is based in Chandler, Ariz., said it will employ 1,000 workers at the site over time as the facility reaches full production capacity -- with the first 100 employees to occupy the complex by year's end during so-called "facilitization and pre-production phases."
The companies did not disclose terms of the agreement but expect the deal to conclude by the end of July. At full capacity, Microchip estimates the Puyallup facility would be capable of supporting $1.5 billion in annual sales.
"As demand for semiconductor devices continues to increase in the current industry cycle, Microchip is responding quickly to secure additional manufacturing capacity," said Steve Sanghi, Microchip's chief executive officer and president. "Without this new facility, we had sufficient manufacturing capacity through the end of year 2001 at our current rate of growth. This acquisition will provide extremely cost-effective additional manufacturing capacity."
The 710,000-sq.-ft. complex sits on a 92-acre campus east of Tacoma and includes approximately 100,000 sq. ft. of clean room space. The facility is said to be capable of producing process technologies down to 0.18-micron, although Microchip in a statement issued today said it will initially produce 8-in. wafers on 0.7- and 0.5-micron processes.
The facility will also house manufacturing operations, offices, meeting rooms, and support functions. Microchip plans to begin installing wafer processing equipment in October, with volume production at the facility expected to begin in August 2001.
The complex received a $600 million upgrade two years ago, when Matsushita built a new fab at the site that was to have been used to manufacture advanced DRAM chips. However, plunging memory-chip prices prompted the company to scuttle those plans and eventually to pull out of the merchant DRAM market, leaving the complex underutilized.
"Our goal is to put this beautiful science park back to work," said Puyallup Mayor Don Malloy, in a statement. "Microchip Technology will be a welcome addition to our community and tax rolls."