MagnaChip (Seoul) disclosed that it has a new majority owner and has reduced its massive debt. The company's majority owner is now Avenue Capital Group (New York), an investment firm. Avenue Capital acquired a majority stake in MagnaChip after the chip maker's recent Chapter 11 filing.

MagnaChip, now privately-held, also outlined its new growth strategy, including a major push in the power semiconductor, touch-screen controller and other areas. It is also expanding its fab capacity and moving into the 0.18-micron BCD (bipolar/CMOS/DMOS) foundry segment.

All told, the company hopes to refine its focus and become a major player in the analog and mixed-signal markets. Going forward, MagnaChip sees itself competing against Fairchild, On Semiconductor and others in the arena.

And despite the setbacks--including the downturn and a bankruptcy filing--MagnaChip is making a strong bid to become the comeback player of the year. Business is booming at MagnaChip right now, said Brent Rowe, president of the company's U.S. unit and senior vice president of worldwide sales.

''We are not going out of business,'' Rowe said. ''I think we're alive and roaring. We're kicking butt.''

At present, IC inventories are lean and demand is ''real,'' he said. To meet the demand, MagnaChip is expanding its fab production. The company's total output within its fabs in Cheongju, South Korea has been recently increased to 70,000 wafers a month, up from 64,000 wafers. The fabs include two 8-inch facilities and one 6-inch plant.

Needless to say, it's been a roller-coaster ride for the company. In 2004, the non-memory chip unit of Korea's Hynix Semiconductor Inc. was sold to a newly-created South Korean company formed by Citigroup Venture Capital Equity Partners L.P., CVC Asia Pacific Ltd. and Francisco Partners. The new company, MagnaChip, inherited three main business lines from Hynix, including CMOS image sensors, LCD drivers and foundry services.

Saddled with debt, MagnaChip soon fell into the red after the spinoff. In 2006, the company hired a new chief executive to jump-start its product and sales efforts.

The company's self-proclaimed turnaround strategy lasted throughout 2007. Then, the bottom fell out of MagnaChip. A proposed initial public offering (IPO) in the United States was scrapped in late 2007.

The company was also hit hard by the current recession. In June of 2009, it filed for Chapter 11 bankruptcy protection in the United States, according to court documents. In September, U.S. Bankruptcy Judge Peter Walsh approved a reorganization plan submitted by MagnaChip.

In the meantime, there were apparently two competing investment firms that were interested in acquiring MagnaChip. At first, it was widely believed that South Korea's KTB Securities Co. Ltd. acquired MagnaChip and its affiliates, according to initial court documents.

But suddenly, on Sept. 25, the judge approved of Avenue Capital's bid for MagnaChip. Avenue Capital already holds 50 percent of MagnaChip's bond debt. The investment firm ''likes (MagnaChip's) business,'' Rowe said. ''They are a believer in us.''

Looking back, there was a silver lining during the Chapter 11 process. MagnaChip had strong technology, but ''we had a balance sheet issue, which was from the LBO,'' Rowe said. ''The interest payment on the debt (from the LBO) was killing us.''

The Chapter 11 process forced MagnaChip to restructure its balance sheet. Its debt has been reduced from $850 million to $62 million, according to the company. ''We've come out of this a lot stronger,'' he said.