Submicron Technology Plc, part of Thailand’s troubled Alphatec Group, owes bills totaling $190m leaving companies in the US and Europe frantically waiting for their money, according to a report in The Wall Street Journal. The grim news confirms our report (CI 3,161) that the company has failed to raise $100m for two new fabrication facilities. Submicron’s problems are sure to make companies more cautious about future projects in Asia. The Wall Street Journal quoted Leslie Merszel, Alphatec’s chief financial officer as saying: We are speaking regularly to those suppliers. They have been very patient and we have a good working relationship going on with them. Alphatec had high ambitions to build a chip industry in Thailand but has been hit with a host of problems, especially a down-turn in the Thai economy, which forced the company to postpone an initial public offering. Dallas-based Texas Instruments pulled the plug on a multi-million dollar deal with Alphatec because the Thai company failed to raise sufficient finance. This decision forced Alphatec to buy out Texas’ $20m stake in two joint ventures for a memory manufacturing plant and a chip assembly plant. Alphatec pleaded for government intervention but Thailand’s finance minister blamed the company for their own problems, saying it had created financial needs which were too big for Thailand’s markets. Now the company is making frantic bids to raise around $550m to complete its construction plants and is looking to government and private sources. Many observers feel Alphatec over-reached itself technically as well as financially and, while it recruited industry veterans from America, the company lacked sufficient expertise to complete such an ambitious project on time.
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