October 4, 2007 – Winbond Electronics Corp. says it has formed a task force to evaluate formation of a new subsidiary to take over the company’s logic IC business next year, a move that would vault the company into the dedicated memory chipmaking ranks of Taiwan’s PowerChip, Nanya, ProMos, and Inotera, and mark the end of the island’s last IDM to do both memory and logic work.

Winbond’s sole 150mm fab (currently 50K WPM @ 0.35-micron) will be allocated to the new IC division, leaving the company’s lone 300mm fab (26-27K WPM) for memory operations, though a second 300mm fab is slated to be completed in late 2008 to boost 300mm output to 35K WPM, notes the Taiwan Economic News. The logic IC business, including voice ICs and computer I/O chips, currently accounts for about 30% of the firm’s ~$92M monthly sales, the paper notes.

The move follows a board-approved plan to reorg Winbond into five activities: consumer ICs, computer-application ICs, DRAM design, flash memory design, and memorychip manufacturing. The consumer and application IC units may be spun off as individual entites at some point in the future, the paper cited the company as saying.

“As the difference by nature between logic IC and memory IC continues to diverge day by day, this strategy will help Winbond to have a good grasp of market trend and maintain its long-term competitiveness for both logic and memory products,” the company explained in a statement.

Winbond before & after logic biz spinoff

Operating elements…………………………Before…………………………………………………….After

Capitalization……………………………..NT$38.7B (US $1.19B)…………………………Undecided

Main business……………………..Memory design/mfg, ………………..Memory chip design/mfg
…………………………………………..logic chip design/mfg

Fab status…………………………….One 300mm fab, one 150mm fab………………..One 300mm fab

Monthly revenues………………….~NT$3B (US $92M)…………………………-30% from current level

Source: Taiwan Economic News