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Microchip Technology Incorporated announced a multi-year initiative to invest approximately $300 million in expanding its operations in India, one of the world’s fastest-growing semiconductor industry hubs.
“Microchip is making a significant strategic commitment to growing our operations in India, whose meteoric growth has established it as one of the top sources of business and technical resources in our sector,” said Ganesh Moorthy, President and CEO of Microchip. “Our investments here will enable us to both benefit from and contribute to the country’s increasingly important role in the global semiconductor industry.”
Microchip’s planned investments are focused on:
- Additional improvements to Microchip’s Bangalore and Chennai facilities and the new research and development center in Hyderabad that the company inaugurated in a ceremony today
- Expanding and enhancing its engineering labs
- Serving the technical and business support requirements of a large and growing set of customers in India
- Accelerating hiring as the company taps into India’s growing talent pool
- Sponsoring technical consortia and supporting academic institutions and programs
- Launching a variety of Corporate Social Responsibility (CSR) programs tailored to regional needs
Approximately 2,500 Microchip employees in India are integral to the company’s semiconductor design and development, sales and support, IT infrastructure and application engineering operations. They strengthen corporate initiatives, support 2,000 customers in the region and make valuable contributions across more than 25 business units that develop solutions for industrial, automotive, data center, aerospace and defense, communications and consumer industries.
“Microchip’s investments in India over nearly two and a half decades have augmented its headcount growth, resulting in building a center of excellence for engineering deliverables and solutions for Microchip’s global success,” said Krishna Moorthy, President and CEO of the India Electronics and Semiconductor Association (IESA). “We look forward to celebrating Microchip’s continued progress in India as it embarks on this impressive growth campaign.”
IESA and Counterpoint Research recently reported that India’s semiconductor market is expected to reach $64 billion USD by 2026, which is nearly triple its 2019 size of $22.7 billion USD. The Semiconductor Industry Association wrote in its February 2023 India Semiconductor Sector white paper that the country now accounts for 20 percent of the total global design workforce. Together, IESA and SIA announced in January 2023 their plans to jointly build on what India has already accomplished as a major hub for semiconductor research, chip design and equipment engineering, with the goal of unlocking even greater future potential.
Original – Microchip Technology
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Elmos Semiconductor SE, one of the world’s leading suppliers of mixed-signal automotive semiconductors, and Littelfuse, Inc., USA, entered into a definitive agreement on the sale of the Elmos wafer fab at the Dortmund site to Littelfuse. Elmos has agreed to sell the wafer fab at a net purchase price of approximately 93 million Euro. Under the agreement, Littelfuse will acquire the Dortmund wafer fab with a highly skilled technology team of approximately 225 employees. All other activities, including testing operations, will remain with Elmos.
In acquiring the Dortmund wafer fab, Littelfuse enhances its capabilities in power semiconductors for high-growth power conversion applications like renewables, energy storage, and e-Mobility charging infrastructure.
“Today’s agreement is a milestone for semiconductor production in Dortmund and it will strengthen Germany’s standing as a high-tech location. As a fabless company, Elmos will make even greater use of advanced technologies to deliver groundbreaking innovations in mixed-signal semiconductors. Elmos is already the global market leader for certain applications in the automotive industry. We want to use this strong position to shape our future growth,” says Dr. Arne Schneider, CEO of Elmos Semiconductor SE.
Headquartered in Chicago, Illinois, United States, Littelfuse, Inc. is a diversified, industrial technology manufacturing company empowering a sustainable, connected and safer world. The company operates across more than 20 countries, and with approximately 18,000 global associates. Its products are found in a variety of industrial, transportation and electronics end markets. In Germany, Littelfuse operates various manufacturing, sales and R&D sites.
The closing of the transaction is expected to be effective December 31, 2024, and is subject to certain closing conditions and regulatory approvals, among them the investment control procedure under foreign trade law conducted by the German Federal Ministry for Economic Affairs and Climate Action. Elmos will retain full operational control over the wafer fab until the closing date.
In addition, Elmos and Littelfuse have agreed to enter into a defined multi-year capacity sharing arrangement with an initial term lasting through 2029, with Elmos buying defined volumes of wafers produced at the fab. This long-term agreement supplements the existing supply arrangements with Elmos’ other foundry partners and ensures that Elmos has the necessary capacities to meet projected customer demand.
“This is good news for the Elmos wafer fab team. We are delighted for Littelfuse to further develop the wafer fab in Dortmund for power semiconductors. Our employees are now expecting a quick review procedure by the relevant authorities,” says Dr. Schneider.
Following regulatory approvals of the transaction, the buyer will make a payment of approximately 37 million Euro. The remainder of the purchase price will be paid at closing. The transaction has no major effects on EBIT in fiscal year 2023, which is why the current forecast for the full-year EBIT margin in 2023 (25% ± 2 percentage points) continues to apply.
Cash flow is expected to be positively influenced in fiscal year 2023 by the payment of approximately 37 million Euro after regulatory approvals. Irrespective of the transaction, Elmos continues to increase its efforts to expand testing capacities for future growth. The company now anticipates capital expenditures of approximately 19% ± 2 percentage points of sales in fiscal year 2023 (previously: 17% ± 2 percentage points). As a result, Elmos now expects a negative operating adjusted free cash flow in 2023.
Original – Elmos Semiconductor
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ORC Manufacturing Co., Ltd. and Resonac Corporation announced that ORC Manufacturing has taken part in the “JOINT2 (Jisso Open Innovation Network of Tops 2)” consortium, which was established under the leadership of Resonac with the aim of developing next-generation semiconductor packaging technologies. As a result, JOINT2 has become a consortium comprised of 13 leading companies in Japan who manufacture semiconductor packaging materials, substrates, and equipment.
As a consortium which has end-to-end testing line of leading-edge technologies covering back-end processes of semiconductor package manufacturing, JOINT2 will accelerate development of technologies for evaluation and manufacturing of next-generation semiconductor packages.
JOINT2 was established in 2021 as a consortium of 12 companies with the aim of establishing next generation semiconductor packaging technologies and evaluation technologies, including 2.5D and 3D packaging through collaboration among member companies. JOINT2 is the successor of “JOINT” consortium, which was established in 2018.
The combination of the member companies’ materials and equipment allows materials and equipment to be evaluated under conditions similar to the semiconductor evaluation tests conducted by customers. This arrangement helps customers save the time and trouble of carrying out individual evaluations for their suppliers and thereby respond to the need of speedy development of semiconductor packages.
Technologies for “back-end processes” of semiconductor-integrated-circuit manufacturing, where semiconductor chips are packaged, are now required to evolve into next-generation technologies that can support 5G and post-5G high-speed data communication systems. Back-end processes consist of many processes, and consume various materials.
Therefore, back-end processes have many technical issues to be solved, and solutions for these issues require collaboration among many companies. Therefore, Japanese manufacturers have large shares in the field of back-end processes of semiconductor package manufacturing because they are good at comparing and adjusting technologies.
ORC Manufacturing is an equipment manufacturer which has forte in optical technologies, and its key product is direct imaging (Dl) system for production of high-density semiconductor packaging substrates. ORC Manufacturing is now developing next-generation Dl system for back-end processes of semiconductor packaging as a part of the project adopted by the New Energy and Industrial Technology Development Organization (NEDO).
ORC Manufacturing’s participation in JOINT2 reinforces the consortium’s end-to-end testing line of leading-edge back-end process technologies. ORC Manufacturing’s Dl system, which does not require photo-mask preparation, is expected to shorten time-to-market of semiconductor packages, and accelerate technological innovations in back-end processes of semiconductor packaging.
Through its participation in JOINT2, ORC Manufacturing aims to acquire wide-ranging knowledge about back-end processes of semiconductor packaging including process evaluation technologies applicable to pre-imaging through post-imaging, thereby strengthen its capability to offer values to customers.
JOINT2 welcomes the new member, and will further promote open innovation and accelerate the development of more sophisticated evaluation technologies, materials, substrates, and equipment applicable to next-generation semiconductor packaging technologies.
Original – Resonac
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Wolfspeed, Inc. announced a $1.25 billion secured note financing from an investment group led by Apollo, with an accordion feature for up to an additional $750 million.
The financing supports the company’s previously announced U.S. expansion efforts and is a significant step toward achieving the company’s $6.5 billion global capacity expansion plan. Execution of Wolfspeed’s U.S. growth plan will accelerate adoption of silicon carbide across a wide array of end markets and support meaningful job creation in US semiconductor manufacturing.
The 9.875% notes will mature in 2030 and are optionally prepayable by the company based on the terms of the indenture governing the notes. The investment was led by funds managed by Apollo’s ~$450 billion Credit business.
“The group’s commitment to Wolfspeed further validates the importance of silicon carbide to the global energy transition,” said Gregg Lowe, president and chief executive officer of Wolfspeed. “This important step in our financing provides significant capital to scale up near-term operations at our Mohawk Valley Fab and construction of our Siler City materials facility to help us capture the growing silicon carbide market opportunity. The financing positions Wolfspeed to continue to lead the growth of the industry and focus on the execution of our vertically integrated strategy to meet growing demand.”
“Our agreement with Apollo and its capital partners achieves our near-term funding targets while prioritizing our shareholders with a new, non-dilutive source of financing,” said Neill Reynolds, chief financial officer of Wolfspeed. “Apollo and its capital partners’ investment follows an extensive review of our business and demonstrates their conviction in our team, operating plan and trajectory.”
“Apollo is pleased to provide a dynamic and flexible credit solution to Wolfspeed as it significantly expands its silicon carbide manufacturing capacity. The company’s growth plan is designed to deliver critical silicon carbide products for a range of automotive and industrial uses, and support sustainability goals with market-leading technology,” said Joseph Jackson, Partner, Apollo Credit. “With the help of our capital partners, we have crafted a facility that can provide up to $2 billion to ramp the company’s expansion plans.”
Wells Fargo & Company (NYSE: WFC) and Morgan Stanley & Co. LLC served as financial advisors to Wolfspeed and Latham & Watkins LLP and Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan, L.L.P. served as legal counsel to Wolfspeed. Paul, Weiss, Rifkind, Wharton & Garrison LLP served as legal counsel to the Apollo funds and the noteholder group. Apollo Capital Solutions provided capital markets and structuring advisory services on the transaction.
Original – Wolfspeed
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Airbus, a global pioneer in the aerospace industry, and STMicroelectronics, have signed an agreement to cooperate on power electronics Research & Development to support more efficient and lighter power electronics, essential for future hybrid-powered aircraft and full-electric urban air vehicles.
The collaboration builds on evaluations already conducted by both companies to explore the benefits of wide bandgap semiconductor materials for aircraft electrification. Wide bandgap semiconductors like Silicon Carbide (SiC) and Gallium Nitride (GaN) have superior electrical properties compared with traditional semiconductors like silicon. They enable the development of smaller, lighter and more efficient high-performance electronic devices and systems, particularly in applications requiring high power, high frequency, or high-temperature operations.
The cooperation will focus on developing SiC and GaN devices, packages, and modules adapted for Airbus’ aerospace applications. The companies will assess these components by conducting advanced research and tests on demonstrators, such as e-motor control units, high and low voltage power converters, and wireless power transfer systems.
Original – STMicroelectronics
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Vitesco Technologies, a leading international manufacturer of modern drive technologies and electrification solutions, has secured strategically important capacities in energy-efficient silicon carbide power semiconductors through a long-term supply partnership with ROHM – worth over one billion US dollars until 2030. The development partnership with the manufacturer ROHM, which began in 2020, created the basis for the supply partnership now signed in Regensburg. Vitesco Technologies’ advanced inverters with integrated ROHM SiC chips will be adopted by two customers, to be applied inside electric vehicle powertrains. Vitesco Technologies will start supplying a first series project as early as 2024. The company is thus even ahead of the originally targeted timeline.
SiC devices enable the design of particularly efficient power electronics, such as those needed for electric car inverters. SiC chips are a key technology, particularly for high voltages and for vehicles with demanding range targets and optimum overall efficiency. During the existing development partnership with ROHM the relevant SiC chips were further optimized for use in automotive inverters starting in 2024.
Silicon carbide belongs to the so-called wide bandgap semiconductors, whose wide bandgap (simplified: the energy gap between the non-conductive state and the conductive state of the electrons in the material) enables lower electrical resistance, fast and low loss switching chips for power electronics. At the same time, SiC chips are more thermally resistant, so that the power density of electronics can be increased.
Thanks to these features, SiC electronics have reduced conversion losses compared to conventional silicon (Si). Especially at high voltage levels such as 800 V, SiC inverters are more efficient than Si models. Since 800 V is the prerequisite for fast and thus convenient high-voltage charging, SiC devices are at the beginning of a worldwide boom. Reduced conversion losses in the inverter are also significant for the overall efficiency of electric driving and thus for range. Competition for sufficient capacities in components made of this high-tech material is correspondingly fierce.
Original – Vitesco Technologies
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STMicroelectronics and Sanan Optoelectronics announced that they have signed an agreement to create a new 200mm silicon carbide device manufacturing JV in Chongqing, China. The new SiC fab is targeting to start production in Q4 2025 and full buildout is anticipated in 2028, supporting the rising demand in China for car electrification as well as for industrial power and energy applications. In parallel, Sanan Optoelectronics will build and operate separately a new 200mm SiC substrate manufacturing facility to fulfill the JV’s needs, using its own SiC substrate process.
The JV will make SiC devices exclusively for STMicroelectronics, using ST proprietary SiC manufacturing process technology, and serve as a dedicated foundry to ST to support the demand of its Chinese customers.
The total amount for the full buildout of the JV is expected to be about $3.2 billion, including capital expenditures of about $2.4 billion over the next 5 years, which will be financed by contributions from STMicroelectronics and Sanan Optoelectronics, local government support, and loans to the JV.
“China is moving fast towards electrification in Automotive and Industrial and this is a market where ST is already well-established with many engaged customer programs. Creating a dedicated foundry with a key local partner is the most efficient way to serve the rising demand of our Chinese customers. The combination of Sanan Optoelectronics’ future 200mm substrate manufacturing facility with the front-end JV and ST’s existing back-end facility in Shenzhen, China will enable ST to offer our Chinese customers a fully vertically integrated SiC value chain,” said Jean-Marc Chery, President and CEO of STMicroelectronics. “It is an important step to further scale up our global SiC manufacturing operations, coming in addition to our continuing significant investments in Italy and Singapore. This JV is expected to be one of the enablers of the opportunity we see to reach $5B+ SiC revenues by 2030. This initiative is consistent with ST 2025-27 $20B+ revenue ambition and the associated financial model, previously communicated to the financial markets.”
“The establishment of this joint venture will be a major driving force for the wide adoption of SiC devices on the Chinese market,” said Simon Lin, CEO of Sanan Optoelectronics. “Being an international, well-known, high quality SiC foundry service company, Sanan will also supply its SiC substrate to this new joint venture, by building a dedicated new SiC substrate factory. This is an important step for Sanan Optoelectronics’ ambitions as a SiC foundry. With this new Joint Venture and the new SiC substrate capacity expansion, we are confident that we will continue to take the lead in the SiC foundry market.” The completion of the project is subject to regulatory approvals.
Original – STMicroelectronics
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GlobalFoundries Inc. and STMicroelectronics announced the conclusion of the agreement to create a new, jointly-operated, high-volume semiconductor manufacturing facility in Crolles (France), which was announced on 11 July 2022.
“I would like to thank Minister Le Maire, the French Minister of the Economy and Finance, and his team for their support and the dedication for the last 12+ months that have made celebrating today’s milestone possible,” said Dr. Thomas Caulfield, president and CEO of GlobalFoundries. “In partnership with ST in Crolles, we are further expanding GF’s presence within Europe’s dynamic technology ecosystem while benefiting from economies of scale to deliver additional capacity in a highly capital efficient manner. Together we will deliver GF’s market leading FDX technology and ST’s comprehensive technology roadmap, in alignment with customer demand which is expected to remain high for Automotive, IoT, and Mobile applications over the next decades.”
“Today marks an important milestone for ST, for GF as well as for Europe. This could not have been achieved without the support of the French government as well as of the European Commission,” said Jean-Marc Chery, President and CEO of STMicroelectronics. “We will further reinforce the European and French FD-SOI ecosystem, building more capacity for our European and global customers in complex, advanced technologies for key end-markets including automotive, industrial, IoT and communication infrastructure, as they transition to digitalization and decarbonization. This new manufacturing facility will support our $20 billion+ revenue ambition.”
The program represents an overall projected cost of 7.5 billion euro for CAPEX, maintenance and ancillary costs. The new facility will benefit from significant financial support from the State of France (administered by Bpifrance). The aid measure, in line with the objectives set out in the European Chips Act and part of the “France 2030” plan, recently received approval from the European Commission.
Original – GlobalFoundries
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Vitesco Technologies and onsemi announced a 10-year long-term supply agreement worth $1.9 billion (€1.75 billion) for silicon carbide (SiC) products to enable Vitesco Technologies’ ramp in electrification technologies. Vitesco Technologies, a leading international manufacturer of modern drive technologies and electrification solutions, is providing an investment of $250 million (€230 million) to onsemi for new equipment for SiC boule growth, wafer production and epitaxy to secure access to SiC capacity.
The equipment will be used to produce SiC wafers to support Vitesco Technologies’ growing SiC demand. In parallel, onsemi, a leader in intelligent power and sensing technologies, will continue to invest substantially into end-to-end SiC supply chain.
In addition, Vitesco Technologies and onsemi will collaborate on optimized customer solutions for Vitesco Technologies. onsemi’s highly efficient EliteSiC MOSFETs will be used by Vitesco Technologies to execute the recent orders as well as future projects for traction inverters and electric vehicle drives.
SiC semiconductors are a pivotal technology for electrification enabling highly efficient power electronics leading to reduced charging times and longer range for electric cars. Especially at high voltage levels such as 800 V, SiC inverters are more efficient than silicon models. Since 800 V is the prerequisite for fast and thus convenient high-voltage charging, SiC devices are at the beginning of a worldwide boom.
Original – Vitesco Technologies
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Magnachip Semiconductor Corporation announced that the Company is separating its display and power businesses into separate entities, following approval by its board of directors and strategic review committee.
YJ Kim, Magnachip’s chief executive officer commented, “This strategic separation represents a significant milestone for Magnachip and underscores the Company’s commitment to unlocking long-term value for our shareholders. The internal separation is aimed at enhancing transparency, accountability and flexibility in business. By establishing distinct entities, we believe our investors will be able to better evaluate the financial performance of each business and their respective contributions. Furthermore, this strategic move will allow each entity to allocate its resources, both financial and technical, more effectively to the specific needs of its customers.”
YJ Kim continued, “Magnachip remains dedicated to delivering innovative solutions and exceptional customer experiences in both the display and power sectors, and we are confident that this separation will strengthen our ability to achieve these objectives by enhancing each business’s agility and focus.”
The Company plans to effectuate the internal separation (the “Internal Split-Off”) by establishing a new subsidiary (“NewCo”) under Magnachip Semiconductor, Ltd. (“Magnachip Korea”), the Company’s operating subsidiary. As part of the transaction, all assets and liabilities of the display business will be contributed to NewCo in exchange for equity. Once the Internal Split-Off is completed, Magnachip Korea and NewCo will both be separate operating companies, with NewCo being a wholly owned subsidiary of Magnachip Korea. The Company’s Gumi fabrication facility will remain with Magnachip Korea as an integral part of its power business.
Post-separation, the board of directors of Magnachip will continue to oversee both operating entities, ensuring cohesive governance, while YJ Kim and the executive management team will manage their business and operations. Each of Magnachip Korea and NewCo will remain indirect wholly owned subsidiaries of Magnachip, and the Internal Split-Off is not expected to have any material impact on the Company’s financial reporting or consolidated financial statements.
The Internal Split-Off is expected to be completed in the fourth quarter of 2023.
Original – Magnachip Semiconductor
