Filtronic Plc, the UK producer of microwave products for cellular and cable telecommunications and electronic warfare, plans to take over a former Fujitsu semiconductor facility at Newton Aycliffe in northeast England to produce gallium arsenide chips aimed at the cellular handset and wireless infrastructure market.
If the scheme gets the go ahead, Filtronic will use the plant to produce an integrated module for mobile handsets, which it claims no other company is capable of producing. Combining an antenna, filter and amplifier, it will replace 24 different components. It claims there has been excellent preliminary results from prototypes supplied to a leading handset manufacturer.
Fujitsu closed the 16Mb memory plant in September 1998 (CI No 3,490) and sold the equipment in March. But it contains one of the largest class 10 clean rooms in the country and Filtronic aims to employ 500 people at the site.
However, with a capital investment of up to 35m pounds ($56m) needed, the deal is conditional on financial support from the UK government as the plant is in an area of high-unemployment and is eligible for government grants.
Filtronic chairman professor David Rhodes argues that gallium arsenide (GaAs) will have the same impact on the IT and communications revolution as silicon has had in the past. The big advantage of GaAs is that electrons travel five times faster than in silicon, requiring less power and thus producing less heat.
The problem has been producing GaAs at an economic cost. Filtronic acquired considerable GaAs expertise with the $43m purchase in 1998 of Litton Systems Solid State division. This operates a 3-inch GaAs design and fabrication plant at Santa Clara, California. In addition, Filtronic has just recruited, as director of technology, professor Chris Snowden who Filtronic describes as a world leading expert in the field of gallium arsenide semiconductors. With a range of products under development for third generation mobile systems, Filtronic believes that it will be able to produce GaAs chips at a price comparable with silicon equivalents.
However, UK analysts were unimpressed by the company’s ambitious plans and the shares crashed almost 20% to 651.5 pence after a warning that there had been a slow start to the new financial year for the US wireless infrastructure business.
