MIGDAL HAEMEK, Israel — Tower Semiconductor recently announced the receipt of the second aggregate equity investment installment of the$305 million investment committed to by Tower’s equity partners.
The $46 million installment follows the achievement of the first milestone in the project plan.
According to the wafer partner agreements, $20.5 million of this installment are accrued as credit toward future wafer purchases from Fab 2 production. Corresponding with their investment, the equity partners received a total of 1,929,999 Tower common shares distributed as follows: SanDisk — 366,690 shares; Alliance — 366,690 shares; Macronix — 366,690 shares; QuickLogic — 122,230 shares; Israel Corp. — 554,069 shares and The Challenge Fund — 153,630 shares. To date, the wafer and equity partners have invested a total of $126 million in exchange for 5,848,722 shares and wafer credits in favor of the wafer partners in the amount of $49.8 million. These values include the current installment and the initial installment of $80 million at the closing of the agreements in January.
“We are pleased with the progress of the project,” said Dr. Yoav Nissan-Cohen, Tower’s co-CEO. “The earthwork and installation of the pilings are moving on schedule, and we expect to begin construction of the building shell in several weeks.”
Dr. Nissan-Cohen added: “The application of a portion of the wafer partners’ investment to credits against future purchases minimizes the dilution of our public shareholders and gives our wafer partners additional incentive to use Fab 2 for their wafer manufacturing needs.”
Tower Semiconductor Ltd. is an independent wafer manufacturer, strategically focused on advanced Flash memory and CMOS Image Sensor technologies. Tower provides manufacturing and turnkey services for integrated circuits (IC) on silicon wafers in geometries from 1.0 to 0.35 micron, using its advanced technological capabilities and the proprietary designs of its customers.
Tower recently began construction of an advanced fab adjacent to its current facility in Migdal Haemek, Israel. The new fab, referred to as “Fab 2,” will employ approximately 1,000 employees and produce up to 33,000 200-mm wafers per month in geometries of 0.18 micron and below, using advanced CMOS technology from Toshiba. Funding for the project is being provided mainly by wafer partners, Israel Corp, an Israeli government grant, bank loans and Tower’s own resources. Wafer Partners include SanDisk Corporation, Alliance Semiconductor, Macronix International and QuickLogic Corporation.