Rishi,
Welcome back. Here is a news. Why Alliance and S3 sold back shares to UMC and made profits and ESS sold back to UMC at costs?
I guess this probably is why they changed CFO.
Steve
ebnonline.com
UMC's joint-venture UICC fab still on
track despite ESS sellout
Semiconductor Business News
(10/28/98, 11:50:42 AM EDT)
United Microelectronics Corp. isproceeding with plans to open the doors
of its joint-venture,United Integrated Circuit Corp., in Taiwan, despite last
week's departure of one of the venture's partners, the company confirmed.
"We are continuing to rebuild the facility," said Jim Ballingall, UMC's vice
president of worldwide marketing, Sunnyvale, Calif. The UICC site was
badly damaged in a fire last year, which caused more than $400 million in
damages and destroyed its new 8-inch facility, but repair work has been
ongoing since then.
ESS Technology Inc. announced last Monday that it was selling its roughly
10% stake in the operation back to UMC for $22.5 million. "ESS was the
only one of our partners who has opted to cash out," said Ballingall.
A spokesman for Fremont, Calif.-based ESS confirmed that the decision
was based on a need to raise cash, as well as a perception that the foundry
market has adequate capacity to satisfy the company's needs. "We
originally made the investment to secure silicon capacity, and it looks like
we will still have that capacity without remaining in the UICC deal," he
said. Along with the sale of its stake in the foundry, ESS also announced
that it will use UMC as one of its primary foundry sources.
Ballingall said the UICC building's shell is nearly complete, and that they
are starting to rebuild the internal infrastructure. The fab is now expected to
resume shipping production wafers sometime next year. UICC is a joint
venture between UMC and, excluding ESS, six North American chip
companies.
UICC had just started to ship wafers at the time of the fire, and UMC
originally said it would take at least a year to get the facility back into
production. All of the chip companies involved in the business have since
shifted their capacity to other foundries, and given the current glut of
foundry capacity, Ballingall said there was no urgent need to open UICC's
doors.
The ESS spokesman said there have also been some setbacks to UICC's
schedule, including another minor fire and some complications related to
installing the equipment. He said those problems were not a factor in the
company's decision to exit the deal.
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