ST and HHNEC in joint wafer fab project

“HHNEC is in the process of finalizing negotiations on technology cooperation with STMicro, who will transfer the 300-mm copper technology to HHNEC's planned 300-mm fab,” said Bill Lu, an analyst with Piper Jaffray, in the report issued on Monday (March 13). “We believe HHNEC has secured [$400-to-$500 million] in funds from the Chinese government, which will be sufficient to build up the initial pilot line for manufacturing,” Lu said in the report. “Thus we expect company to issue initial system orders in the range of [2,000 wafer starts per month] in C2Q '06, then follow up with orders of another [3,000-to-5,000 wafer starts per month] in C3Q '06 to ramp the total capacity to [5,000-to-7,000 wafer starts per month] by end of 2006 or early 2007.” Along with the 300-mm wafer fab project together with HHNEC STMicro is expanding its reach in China by establishing a memory manufacturing wafer fab in Wuxi City together with Hynix. That wafer fab is sceduled to manufacture both DRAM and NAND flash memories. A line for processing 8-in. wafers is scheduled. A line for 300-mm diameter wafers is due to begin production in late 2006. According to EETimes STMicroelectronics is planning to spend $500 million on a wholly-owned test, marking and packaging (TMP) facility in Shenzhen as well.