January 31, 2007 – Japan’s Oki Electric Industry Co. Ltd. has signed a deal to offload design-to-manufacture services to Taiwan foundry UMC and partner fabless ASIC house Faraday Technology Corp., focusing on 90nm- and below process technologies, deepening ties originated four years ago between Oki and UMC’s Japan unit. Faraday already offers Oki design services for 130nm and 90nm.

The partnership essentially means Oki can maintain focus on its frontend design and sales channels for system LSIs in a “fab-lite” model, without dedicating resources to a new fab and product development.

“Our strength is the OKI global brand, Japan and worldwide market expertise and sales channels,” said Masahiko Morioka, president of silicon solutions company at Oki. “We are looking forward to Faraday’s inputs of its beyond 90nm IPs, design services and backend support to bring more cost effective solutions with better performance and fast turnaround time to the Japanese and Asian markets. This agreement also enables us to focus our resources more effectively on our system know-how, marketing, and customer relationships.”

The deal should result in a “considerable” boost to Faraday’s revenue in 2H07, noted the Taiwan Economic News, adding that Oki has been placing increased emphasis on control chips for LCD and telecommunications chips.