Hitachi, UMC plan quick start of 300-mm joint venture in Japan

Hitachi, UMC plan quick start of 300-mm joint venture in Japan
TOKYO--Hitachi Ltd. and Taiwan's United Microelectronics Corp. today announced plans for a joint venture in 300-mm wafer processing, which will be based in Japan and begin manufacturing operations in early 2001. The unnamed joint-venture company will be located in Hitachi's N3 building in Hitachinaka, and it is scheduled to begin pilot runs of 300-mm wafers in January 2001.

"This joint venture will result in one of the world's first 300-mm wafer plants in mass production," predicted Robert Tsao, chairman of UMC, the world's second largest pure-play silicon foundry company, which is based in Hsinchu, Taiwan.

Mass production in the 300-mm joint venture is slated to begin in April 2001, according to Hitachi and UMC. Both companies plan to jointly contribute technologies for the fab's initial 0.18-micron processes. The partners estimated that 70 billion yen ($680 million) will be invested in the fab's initial capacity, which is set to reach 7,000 wafers a month by the second half of 2001.

UMC and Hitachi have been negotiating a major manufacturing alliance for several months. UMC officials told SBN in late October that as much as 20% of Hitachi's semiconductors could be fabricated under a major agreement (see Oct. 29 story).

Under the 300-mm joint-venture pact, Hitachi will own 60% of the new company with UMC holding the remaining 40% share. Half of the joint venture's capacity will be reserved for Hitachi's products, with the other half being used to serve UMC's foundry customers, according to the agreement. The joint-venture company will be established by the end of February 2000.

The planned 300-mm venture will be UMC's second operation in Japan. The Taiwan company acquired a 56% stake in Nippon Steel Semiconductor Corp in 1998, and it is now converting the DRAM production facility into a silicon foundry operation. UMC also plans to set up a 300-mm fab in Taiwan's new Tainan Science-based Industrial Park, located in the southern part of the island. Fab 12A is expected to be equipped in the first quarter of 2001, but it remains unclear how the new joint venture in Japan will impact the timing of that wafer-processing plant.

"Through the joint venture, Hitachi and UMC will better meet the growing demand for advanced ICs, including next-generation system-on-chip designs," said Tadashi Ishibashi, president and CEO of Hitachi's Semiconductor and Integrated Circuits group. "Hitachi and UMC expect that the joint investment will accelerate the ramping-up of production and maximize returns on investment for the new company."

--Additional reporting provided by J. Robert Lineback in the U.S.