AIT and Nakaya Microdevices Form Joint Venture

10/01/2002

TOKYO AND PLEASANTON, CALIF. — Advanced Interconnect Technologies (AIT) and Nakaya Microdevices Corp. of Japan have created a joint venture to provide subcontract assembly and test services to Japan. The new organization, AIT Nakaya Singapore PTE Ltd., represents the first joint venture between U.S.- based and Japan-based assembly and test subcontractors.

According to AIT and Nakaya, the objective of the venture is to channel the assembly and test demands of Japanese integrated device manufacturers (IDM) to AIT's low-cost facilities in Batam, Indonesia and Hong Kong.

"This agreement represents a key milestone for the entire contract assembly and test industry," said Ralph Duceour, president and CEO of AIT. "We view the market in Japan as having a significant upside potential for the assembly and test business, and this joint venture provides AIT with an excellent opportunity to increase its business relationships in Japan while providing world-class contract semiconductor assembly and test services."

This type of agreement is a different strategy for gaining access to the growing market for providing assembly and test subcontracting to companies in Japan. Previously, subcontractors have purchased back-end operations (or a share of them) from Japanese IDMs wishing to outsource their packaging functions. By funneling the services through a Japanese subcontractor to lower cost facilities, the Japanese companies have another option for packaging their ICs.