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Samsung To Invest and Divest $250M DRAM gear investment in Austin Semi; Sale of some non-memory businesses. Austin, Texas--Samsung plans to invest more than $400 million in two of the company's manufacturing facilities, Samsung Austin Semiconductor (SAS) in Austin, Texas, and Samsung Display Mexicana in Tijuana, Mexico, the company revealed last week. In the meantime, the Korean electronics giant confirmed through a spokesperson that it is considering selling part of its non-memory chip business to a foreign company. A Samsung Electronics corporate spokesperson said details of the sale have not been completed. In addition to other unnamed non-memory chip operation, the Korean company confirmed published reports that it is selling its Puchon plant, which consists of transistors, power devices and linear ICs. Non-memory semiconductors account for 30 percent of the chip company's total chip business. Samsung Electronics is taking these steps to streamline its business as part of the company's restructuring. The company is cutting to its core competencies. A Samsung spokesperson did not wish to comment further. North America A Priority While Samsung continues its strategic retrenching, the company's focus on North America broadens. "While Samsung has operations throughout the world, North America is a priority region for the company," said Byung-Kwan Bae, CEO of Samsung Electronics America. In Austin, Samsung will invest $250 million in chip-making equipment for its 64-megabit SDRAM manufacturing. Meanwhile, Samsung will also pour $150 million in its Tijuana manufacturing complex in order to boost annual output of large-sized color picture tubes (CPT) for televisions at SDM. According to Samsung, the $250 million figure represents roughly the exact same investment total planned prior to the Asian financial crisis. In early 1997, Samsung had extravagant plans for billions of dollars worth of investments in its concerns. Following the dramatic fiscal retrenching in Korea and surrounding regions in the past year, the company was forced to scale back those plans and to restructure. The restructuring delayed, but did not diminish the company's investment in SAS. Phase Two Delayed, But Inevitable "Other than it being somewhat more drawn out, it is essentially the same as what we called Phase Two," says Bill Cryer, spokesperson for Samsung Austin Semiconductor, regarding the equipment investment. Phase Two would have begun this past spring, according to the Korean electronics giant's plans. In January of 1996, Samsung announced its plans for SAS. In March of that year, the company broke ground. July saw the first wave of equipment roll in, with the building open by early August. Samsung Austin Semiconductor reached first silicon in September. After that, phase two would have been scheduled for the spring or early summer of 1998. These plans, however, were pushed back until the fall of 1998. Samsung began to place its orders this September. To some degree, the company's hand was forced. In order to make this $1.2-billion plant economically feasible, "it had to go into full production at some point, and this is a continuation of that process," says Cryer. "It wouldn't have made sense to built this at its cost and size and then fill it to half-capacity." Samsung will add deep-ultraviolet steppers from ASM Lithography, wafer fabrication tools from Applied Materials and Novellus Systems, wet processing tools, diffusion tools furnaces and metrology tools from KLA-Tencor. These tools will move in and come on by late February/early March. Cryer expects full production sometime in March. "When we built it, we filled up half of it with tools; now we will fill the other half for production," says Cryer. The new tools "just about double our production of wafers. Brings us somewhere closer to 20,000 wafers per month," he says. SAS will increase its production capacity from the current 3 million 64-megabit DRAMs per month to more than 4 million per month. Using the new gear, SAS will use bring the line size down to 0.22-micron and eventually down to 0.18, according to Cryer. In Mexico, the strategic investment in Samsung Tijuana Park (STP) will make Samsung the largest CPT producer in North America, the company claimed. "The manufacturing facilities in Tijuana and Austin are the cornerstone of Samsung's North American expansion, and these latest investments demonstrate our commitment to our customers and business partners in the region," said Bae. |