GlobalWafers to invest over NT$13 billion in South Korea

Taipei, Oct. 6 (CNA) Taiwan-based GlobalWafers Co., the third largest silicon wafer supplier in the world, has decided to invest more than NT$13 billion (US$422 million) in its plant in South Korea.

In a board meeting held on Friday, the company approved the plan to pour US$438 million or about NT$13.4 billion into in its subsidiary MEMC Korea Co., to expand its 12-inch wafer production capacity in its existing plant.

The South Korean unit is expected to see its production expand by 150,000 units a month and sample shipments of the new capacity is scheduled to start in the third quarter of 2019, with mass production to begin in 2020, GlobalWafer said.

The plant of the South Korean unit is located in Cheonan, a city about 80 kilometers south of Seoul.

The investment decision was made based on the Long Term Agreement (LTA) signed by the company and its clients, and the entire new capacity will be fully allocated to clients covered under the LTA.

Market analysts said global silicon wafer demand has been on the rise, which has resulted in a tight supply and rising product prices, and many clients are rushing to book production capacity in an attempt to avoid a supply shortage and even more expensive prices.

Due to solid demand, GlobalWafers said its production capacity has been fully booked and its product prices have kept rising.

In the third quarter of this year, GlobalWafers posted NT$15.16 billion (US$492 million) in consolidated sales, a new record high, up 5.5 percent from a quarter earlier. It was the 11th consecutive quarter for the company to report an increase in revenue.

GlobalWafers said the company is upbeat about its business outlook for the rest of this year at a time when new tech applications such as automotive electronics, 5G, memory chips, the Internet of Things, artificial intelligence and high performance computing continue to boost demand for silicon wafers.

In late 2016, GlobalWafers completed a deal to acquire Singapore-headquartered SunEdison Semiconductor Ltd. for US$683 million, becoming the world's third largest silicon wafer supplier.

In the first half of this year, GlobalWafer posted NT$14.36 in earnings per share, up from NT$4.17 over the same period of last year.

Source: Focus Taiwan News Channel