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Japan’s SUMCO to raise $1.1bn to build silicon wafer plants

By Andreas Ismar

05:07, 13 October 2021

Technician checking silicon wafer using microscope
Technician checking silicon wafer using microscope - Photo: Shutterstock

Japanese silicon wafer manufacturer SUMCO is seeking to raise JPY125.8bn ($1.1bn) from secondary shares offering to help finance the construction of a new plant amid global semiconductor shortage.

Shortages of semiconductors have forced major automakers to cut output as they compete with rising chip demand from manufacturers of smartphones, personal computers, and other gadgets. Against this backdrop, SUMCO will build a new plant for 300mm silicon wafers as current capacity can not meet the rising demand.

The company is offering 60 million new shares at JPY2,097 apiece, 3% lower than Tuesday’s closing price of JPY2,162, it said in an exchange exchange filing. Shares in SUMCO was traded at JPY2,145 past midday on the Tokyo Stock Exchange.

Total investment of $2bn

In total, SUMCO will invest JPY228.7bn in building the new plant, the company said in a separate statement. Construction of the new plant, which will be built in existing manufacturing site in Imari, Japan, will start next year and expected to come on stream in 2023.

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“Supply and demand became increasingly tight for 300mm silicon wafers for logic use, driven by demand for PC, smartphone, and data centre use, as teleworking and the spread of 5G mobile communications resulted in increased network traffic,” said SUMCO chairman and CEO Mayuki Hashimoto.

He added: “Looking ahead to the third quarter, the market for 300mm silicon wafers is expected to see further supply and demand tightness, as demand grows for memory use in addition to logic use. We expect supply and demand tightness to continue also for wafers of 200mm and smaller, sustained by strong demand” from automotive sector, consumer product, and industrial use.

Read more: Japan posts double-digit export growth on semiconductor demand

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