Fab for sale
Hank Hogan
SPARTANSBURG, SC — IN THE LAST year, large semiconductor plant closings in the United States have included Mitsubishi and Motorola in North Carolina, Hitachi in Texas, Matsushita in Washington, Fujitsu in Oregon, and Toshiba in Santa Clara.
There`s a reason behind this glut of activity. “It`s the law of supply and demand. There was too much capacity pro ducing too much product. Consequently,
the prices plunged. And these facilities could no longer operate in a manner that made sense economically,” explains Doug Berman, vice president at Dove Brothers LLC (Foster City, CA).
Dove Brothers announced in early February that it had been retained by MEMC Electronic Materials Inc.(St. Peters, MO) to find a buyer for MEMC`s 150-mm wafer production plant in Spartanburg, SC. That came in the same month that Dove Brothers handled the auction of equipment at a Hitachi chip plant in Irving, TX.
So, what happens to a semiconductor cleanroom that`s no longer needed?
In the case of the MEMC facility, the cleanroom, the equipment, the land, and the on-going business are being sold as a unit. In the case of the Motorola plant in North Carolina`s Research Triangle Park, the equipment has been disposed of through auction or donation. What`s left is a 177,000-square-foot building with 22,000 square feet of Class 10 or better cleanroom.
The sale of the Motorola facility is being handled by the Chesterton Blumenauer Binswanger International office in Charlotte, NC. Doug Faris, a senior vice president at Binswanger, reports that prospective buyers who aren`t used to cleanrooms wonder where the building square footage is. They don`t realize that every square foot of cleanroom requires two or more feet of support space.
For this reason, the number of buyers for such specialized facilities are limited. The sale of cleanrooms will, by necessity, take time. This is especially true if the industry, and many likely buyers, face tough economic conditions. Furthermore, unlike ordinary building space, a cleanroom isn`t something that can simply have heating, ventilating, and air conditioning turned off.
Cleanroom auctions
Steve Scher owns used equipment company Equipment for Technology and Science Corp. (San Jose, CA). As such, he is frequently at cleanroom auctions, bidding on various pieces of wafer fabrication equipment. His experience is that a cleanroom may cost $200 to $300 a square foot to build, but only fetch $10 a square foot if sold with the intention of being moved to another site. It`s very expensive to take a cleanroom apart, transport it, reassemble it, and restore it to an appropriate level of operation.
On the other hand, the equipment and tools in a cleanroom can be valuable. Often such tools function perfectly. It`s the march of technology that has made them obsolete.
Intel Corp., Scher points out, may want the latest equipment capable of tackling the most demanding linewidths. Other companies, both inside and outside the U.S., don`t require such leading edge processing, and buying used equipment can save quite a bit of money.
“The end user buying from a dealer will generally pay between 30 and 70 percent of the new cost,” notes Scher.
A search on the Internet for used semiconductor equipment turns up dozens of dealers. In addition, there are brokers who bid on specific pieces of equipment at auction for end-users. These brokers make their money off of targeted buying, as opposed to dealers who maintain an inventory. End-users who bid for themselves are the final auction component.
However, it isn`t always true that used equipment costs less than new. During good economic times for the semiconductor industry, it may be that some tools have very long lead times. Hence, the fastest way to acquire such a tool may be through auction.