Posts Tagged ‘ UMC ’

UMC, He Jian terminate merger deal

UMC, He Jian terminate merger deal.

Taiwan’s United Microelectronics Corp. (UMC) has terminated its acquisition agreement with Infoshine Technology Ltd., the holding company of Chinese foundry vendor He Jian Technology Suzhou Co. Ltd. SAN JOSE, Calif. – Taiwan’s United Microelectronics Corp. (UMC) has terminated its acquisition agreement with Infoshine Technology Ltd., the holding company of Chinese foundry vendor He Jian Technology Suzhou Co. Ltd.

This was seen as a blow for UMC, which counted on He Jian for access into the China market. Last year, foundry vendor UMC said it would pay $285 million to acquire the 85 percent of Chinese foundry He Jian that it did not already own. UMC already owned 15 percent of He Jian.

Then, UMC’s proposed acquisition of Chinese foundry He Jian was in jeopardy last year, because of Taiwan government regulations, according to a report issued by a trade group. A report by the U.S.-Taiwan Business Council on the Taiwan semiconductor market states that Taipei is standing in the way of the deal because investment regulations stipulate that there can be no more than three Taiwan chip fabs in China, and that all three are spoken for.

The original merger consideration involved a combination of common shares, ADR and cash as options for payment to He Jian’s shareholders. ”However, an investment regulation governing foreign holdings of Taiwanese securities, coupled with other restrictions from the amended operating rules of the Taiwan Stock Exchange Corporation for issuing new shares to merge foreign unlisted companies, precluded the issuance of common shares or ADR as payment options,” according to UMC.

”Meanwhile, He Jian’s shareholders had not decided whether to accept a cash-only merger. As such, based on considerations of timing and changes in the industry environment, the board resolved today to terminate the merger agreement,” according to UMC.

Going forward, UMC said it will continue seeking possible alternatives with He Jian shareholders, including a full or partial acquisition of He Jian in cash upon revaluation.

At a low-key event in Taiwan earlier this year, silicon foundry vendor UMC celebrated its accomplishments during its 30th anniversary. But will 2010 be UMC’s last party? Despite the current upturn and renewed growth at UMC, many wonder if the foundry vendor will survive in the long run, as the company has fallen behind the technology curve.

At one time, the company sat comfortably as the world’s second largest foundry vendor, behind neighbor Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC). Now, it faces competition from a trio of strong players, including TSMC, GlobalFoundries and Samsung Electronics Co. Ltd.

Going forward, UMC has two choices. The company could continue to go it alone-without a big R&D partner. Or, UMC could get acquired.

Some believe that GlobalFoundries or its big investor–Abu Dhabi’s Advanced Technology Investment Co. (ATIC)–may take a stake in UMC in return for fab capacity. In fact, there was once a rumor that ATIC would buy UMC.

Others believe that TSMC may buy UMC. There have been talks over the years about such a deal taking place.

Advertisements – GlobalFoundries, ASML linked to UMC fund raising – GlobalFoundries, ASML linked to UMC fund raising.

LONDON — Foundry chip manufacturer United Microelectronics Corp. (Hsinchu, Taiwan) wants to involve a strategic partner in plans to raise capital according to local reports and market watchers have indicated GlobalFoundries Inc. (Sunnyvale, Calif.) as a candidate.Alternatively a consortium based around a mix of GlobalFoundries, a leading customer and leading equipment supplier ASML Holdings NV could provide a way forward for UMC. GlobalFoundries, which has a major fab under construction in New York, is eager to add capacity quickly and tapping into UMC could allow it to achieve that using the leverage of an additional cash injection.

Earlier in May UMC said it was planning a private placement of no more than 10 percent of its total shares or about $400 million. Analysts noted at the time that UMC lags behind TSMC, Samsung and GlobalFoundries in process technology and that UMC might cut a deal with either IBM or GlobalFoundries or a leading customer such as Texas Instruments (see Analyst: UMC seeks R&D partnership).

Now UMC’s board has approved plans for the issue of up to 1.3 billion new shares worth about $400 million, subject to approval by shareholders, according to a Digitimes report.

UMC wants to involve a strategic partner and is open to involvement from any strategic partner through the private placement, the report said, quoting chief financial officer Chi Tung Liu.

Texas Instruments, ASML and GlobalFoundries are among the potential investors for the placement, the report said, referencing the Chinese LanguageEconomic Daily News, which in turn cited unnamed sources.

Advanced Technology Investment Co., the Abu Dhabi owned parent of GlobalFoundries was rumored to have approached UMC in January 2010 with a view to taking a stake in UMC and securing additional production capacity. The link was denied at the time. – Report: Abu Dhabi seeks stake in UMC – Report: Abu Dhabi seeks stake in UMC.

Report: Abu Dhabi seeks stake in UMC
SAN JOSE, Calif. — After buying Singapore’s Chartered Semiconductor Manufacturing Ltd., Abu Dhabi’s Advanced Technology Investment Co. (ATIC) is now looking at buying a stake in Taiwan’s United Microelectronics Corp. (UMC)., according to reports.ATIC has approached UMC for talks on a ”possible stake buy,” according to Reuters. UMC’s stock jumped as a result of the rumors.

ATIC denied the rumors about UMC, the world’s second largest foundry, next to TSMC. ”There’s nothing to it. ATIC’s priority is making sure Globalfoundries, with the integration of Chartered Semiconductor of Singapore, is off to a smooth start, fully backed by ATIC’s focused support,” said Brian Brian Lott, executive director of communications for ATIC, in an e-mail response.

In September, ATIC acquired Chartered for a total of $3.9 billion. Chartered will be folded into GlobalFoundries Inc., the former manufacturing division of Advanced Micro Devices Inc. (AMD).

Pooling resources from Chartered and GlobalFoundries will enable the new company to better compete in the tough wafer supply industry with market leader Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC). The combined entity will benefit from GlobalFoundries’ technology expertise while tapping into Chartered’s customer base to boost sales.

With UMC, ATIC believes it can better compete against TSMC, according to the report. Others see a nightmarish integration process between GlobalFoundries, Chartered and UMC.

TSMC purchases US$4.5 billion worth of equipment in 2009

Claire Sung, Taipei; Jessie Shen, DIGITIMES [Tuesday 5 January 2010]

Taiwan Semiconductor Manufacturing Company (TSMC) spent more than NT$145 billion (US$4.57 billion) on machinery equipment in 2009, while rival United Microelectronics Corporation (UMC) allocated around NT$22 billion to equipment, according to respective company filings with the Taiwan Stock Exchange (TSE).

Last year, TSMC distributed around NT$28 billion to Applied Materials and NT$24 billion to ASML, and over NT$10 billion each to Tokyo Electron, Dainippon Screen Manufacturing and KLA-Tencor. These major tool suppliers accounted for almost 70% to the foundry’s total equipment spending for 2009.

TSMC was quoted in previous reports as expecting to begin risk production on 28nm low-power (28LP) node at the end of first-quarter 2010, followed by 28nm high-performance (28HP) between the second and third quarters.

TSMC had reportedly been engaged in ramping yield rates on its 40nm process during the latter half of 2009. The segment accounted for 4% of TSMC’s third-quarter revenues, compared to 1% in the first and second quarters.

Compared to TSMC in expenditures and pace, UMC took a more cautious approach towards capacity expansion last year.

UMC is on track to start pilot production for its 28nm low-power and high-performance nodes in the latter half of 2010, company central R&D vice president SC Chien said in previous reports. Chien noted the majority of UMC’s 2009 capex would be used on R&D for next-generation processes (32nm and beyond),

UMC has claimed it is shipping more 12-inch wafers on 65/55nm and 45/40nm, which took a combined 14% share of UMC’s total revenues in the third quarter of 2009.

TSMC and UMC, respectively, are scheduled to hold their fourth-quarter investors conferences on January 28 and February 3.

via TSMC purchases US$4.5 billion worth of equipment in 2009.