The Wall Street Journal
Texas Instruments Inc. (TI) said Wednesday it will purchase two semiconductor wafer manufacturing plants and equipment in Japan from a unit of Spansion Inc. (SPSNQ) to boost capacity for chips used in a variety of electronic gadgets.
Financial terms of the transaction weren't disclosed.
In a statement, the U.S. chip maker said it will buy a 200-millimeter wafer fab currently in operation in Aizu-Wakamatsu, Japan, that is capable of expanding Texas Instrument's analog revenue by more than $1 billion. The second facility will be either a 200-millimeter or 300-millimeter fab, it said.
A plant using 300-millimeter wafers is more advanced than a 200-millimeter wafer plant, cutting a chip maker's manufacturing costs by as much as 30%.
"This acquisition is the most recent in a series of analog manufacturing expansions announced by TI over the past 24 months which collectively will add capacity for more than $3.5 billion of additional analog revenue per year when fully operational," the company said.
Chip makers globally are expanding capacity this year as demand improves along with the recovery in the global economy. Demand has been stronger than expected thanks to the emergence of new applications such as smartphones, e-readers and tablet PCs in which chips are widely used. Texas Instruments' rivals Intel Corp. and Samsung Electronics Co. have been posting strong earnings in the most recent quarter, thanks to a rebound in demand and higher prices.
The company said it will offer employment to a majority of Spansion Japan Ltd. employees in Aizu-Wakamatsu, Japan, where the facilities are based. It plans to run the first fab and preserve the second facility for future capacity expansion, it said.
The company's analog chips are widely used in set-top boxes, electronic books and smartphones.
Based in Sunnyvale, Calif., Spansion filed for bankruptcy protection in March 2009, weighed down by $1.5 billion in debt. The company, which makes flash-memory chips used to store data in iPods and digital cameras, exited bankruptcy in May.
