April 17, 2007 – Elpida Memory’s offer of equipment to SMIC is seen as an attempt to acquire a stake in SMIC’s new 300mm wafer fab and its older 200mm fab, in an attempt to secure more capacity for DRAM and raise the stakes in its battle with rival Samsung, according to the Taiwan Economic News.

Elpida already has inked a deal with PowerChip Semiconductor Corp. on a multibillion, multisite DRAM fab complex. Now, the Japanese chipmaker is expected to soon announce a deal to offer technology and equipment to SMIC to acquire the 200mm and 300mm facilities, with SMIC agreeing to repurchase ownerships in three and five years, respectively, according to the paper, citing “Taiwan industry watchers.”

Earlier this year Elpida sold used 200mm tools to a Chinese firm in Chengdu, with SMIC tabbed to operate the facility. The new tools will more than triple the facility’s output capacity to 70,000 wafers/month by the end of this year.

SMIC aims to finish tooling its new 300mm facility in 2Q07 and ramp to volume production later this year, with initial output of 12,500 wafers/month and ramping to 20,000-25,000 wafers/month in two years, the paper said.