SMIC, UTAC to form China backend JV

May 5, 2005 – Chinese foundry Semiconductor Manufacturing International Corp. (SMIC) and Singapore-based United Test and Assembly Center Ltd. (UTAC) have agreed to form a joint venture to provide assembly and testing services in Chengdu, China, targeting memory and logic.

SMIC will invest $51 million for a 51% stake in the operation. UTAC, which already has an existing facility in Shanghai focusing on mixed-signal and advanced memory chips, will pay $30 million for a 30% stake, with the remainder supported by financial investors and employees.

Construction of the 11,000 sq. m facility is now underway, with mass production expected to begin in 4Q05, initially serving SMIC’s existing customers. The venture expects to be profitable from next year and to record sales of US$300 million in 2007.

“We plan to use our initial profits generated from the [US$175 million] Chengdu plant to continue investing in our facilities,” SMIC chief executive Richard Chang said in Singapore.


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