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December 29, 1999

Hitachi & UMC to Spend $70bn on 12-Inch Wafer Venture

By CBR Staff Writer

Hitachi Ltd and United Microelectronics Corp (UMC) are planning invest 70bn Yen ($685.7m) in a new plant that will start producing 12-inch (300mm) wafers by 2001. The companies plan to establish a joint venture by the end of February 2000, which will be 60% owned by Hitachi, with UMC holding the other 40%. The manufacturing capacity will be split equally between the two firms.

The plant, which will be based in Hitachinaka-city, Japan is expected to produce up to 7,000 wafers on a 0.18 micron process by the second half of 2001. Hitachi will concentrate on producing system-on-a-chip components for the PC, mobile communications and consumer products market. UMC will use its capacity for its foundry customers.

The Hitachi-UMC plant will be one of the world’s first 12-inch wafer fabs. However, Semiconductor 3000, the joint venture between Motorola Inc and Infineon AG, the semiconductor arm of Siemens AG, has already produced its first prototype 256Mb DRAM chips using 12-inch wafers from its plant in Dresden, Germany.

Producing chips on 12-inch wafers reduces costs because two and a half times more chips can be produced than when using today’s standard 8-inch wafers. However, for many companies, the cost of building production lines that can produce 12-inch wafers will preclude them from moving from 8-inch lines until the larger wafers become an industry standard.

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