AUG. 26–GRESHAM, OR–Fujitsu Microelectronics turned the keys to its computer chip factory over to its new owner recently, just less than six weeks after announcing it would sell the plant to Microchip Technology for $183.5 million.
[See “Microchip to buy Fujitsu fab for $183.5 million,” CleanRooms, August 2002, page 4.]
The companies closed the deal shortly after clearing the last government hurdle for a property tax break that Microchip demanded as a condition of the sale.
Gresham and Multnomah County last week approved the strategic improvement program tax break, worth an estimated $17.3 million. The final blessing came
Friday in a unanimous vote of the Oregon Economic Development Commission’s finance committee.
The closing was marked by a flurry of signatures, a ceremonial key transfer at the Gresham plant and a special dinner Friday night for Fujitsu and Microchip executives. Otherwise, the date marked a “seamless” transfer of the plant’s operation and maintenance, says Robert J. Lloyd, Microchip’s vice president of site services and facilities management.
The company won’t be adding anything or modifying the building until Nov. 1, he said. Production is not scheduled to start until next year.
More than 900 people worked at the plant last summer. Fujitsu started setting up shop in Gresham in 1984 and originally planned a cluster of factories that
would employ up to 6,000. But last November, amid the worst semiconductor slump in history, Fujitsu announced the plant would close.
One of the few serious shoppers was Arizona-based Microchip Technology, which makes microcontrollers used in thousands of products such as water pumps, air
bags and garage door openers. It weathered the slump better than many semiconductor companies and saw the Fujitsu plant as a chance to expand to a more technically advanced facility at a bargain price.
In the midst of Oregon’s recession, negotiations for the tax break were fast and free of controversy. County executives said Fujitsu was eager to leave. It was spending millions of dollars to maintain the plant’s clean room and wanted to sell quickly or shut down.
The tax break agreement caps the property’s assessed value at $100 million. Taxes would kick in again if the value rises above $490 million, although Microchip doesn’t plan to invest more than that.
In return, Microchip would agree to a number of employment, environment and education goals. It also would pay a quarter of the tax break’s value, up to $2
million, to the city and county as a “community service fee.”
Microchip has promised to hire as many former Fujitsu workers as possible in the next 1-1/2 years. It plans to employ 100 people by next summer and about 400
by 2009. The plant already employs about 21 former Fujitsu workers, as well as an Arizona transition team of about 10 to 15 people, Lloyd says.