May 3, 2005 – Advanced Semiconductor Engineering Inc. yesterday provided additional information relating to the fire that took place Sunday at its facilities in Chungli, Taiwan. The company estimates the damage to equipment and inventory on the first four floors, which suffered direct fire damage, at US$130 million, most of which is covered by insurance.
Local authorities have initiated investigations into the cause, while the company has commenced discussions with insurance providers relating to damage claims, ASE said. Yesterday’s company news report said that no deaths were incurred, but there were injuries to workers working overtime. The company also said the suspected cause was a boiler explosion on the ground floor.
ASE has retained structural engineers to assess the extent of the damage to the building that caught fire. The first four floors housed part of the operations for the production of interconnect materials. The cost estimate above does not include any damage to the building that has been incurred.
In addition, most of the equipment and inventory on other floors of the 11-story building, the substantial majority of which is for semiconductor packaging and test, while not damaged by the fire, were damaged by smoke caused by the fire. Upon regaining access to all floors, ASE expects to commence, with the insurance providers, the process of assessing the actual extent of damage and will begin clean-up efforts.
The company currently estimates that its production facilities in Kaohsiung have sufficient packaging and test capacity to meet all customer requirements that are expected to be diverted from Chungli as a result of the fire. Following direct communications with its customers, ASE expects to facilitate expeditiously their qualification of ASE’s Kaohsiung facilities in order to give effect to the planned transfer of production as quickly and smoothly as possible, pending the recovery of Chungli to full operating capacity.