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Technology Stocks : Lam Research (LRCX, NASDAQ): To the Insiders -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (3569)	10/28/1999 2:26:00 PM
From: Duker	Read Replies (1) \| Respond to of 5867

UMC to continue fab buildup with $2.4 billion in tool orders next year semibiznews.com By J. Robert Lineback Semiconductor Business News (10/28/99, 01:33:26 PM EDT) HSINCHU, Taiwan -- To keep up with the surge in silicon foundry demand, UMC Group here plans to issue another $2.4 billion in purchase orders for semiconductor capital equipment in 2000 after ordering about $2.4 billion of wafer fab tools this year, said Peter Chang, CEO of the company's foundry operations. Next year, UMC aims to increase its total chip-processing capacity by 41% to 2.4 million 8-inch equivalent wafers vs. 1.7 million in 1999, said Chang during a briefing today with industry analysts and journalists. In 2001, UMC expects to have the capacity in place to fabricate 3 million wafers in Hsinchu, he said. UMC's aggressive capital spending plans comes at a time when nearby rival Taiwan Semiconductor Manufacturing Co. is also dramatically increasing its investments in wafer-processing capacity. Last week, an official with TSMC said the world's largest pure-play foundry company will spend more than $2 billion to raise its total capacity about 50% to about 2.7 million 8-inch equivalent wafers in 2000 (see Oct. 19 story). This year, UMC will end up spending $1.7 billion in cash on delivered fab equipment, Chang estimated. In 2000, UMC will spend more than $2 billion on additional production equipment, he added. "During the next two years, silicon foundry demand will be extremely strong because the industry has not invested enough money to keep up with the growth," noted Chang during the briefing at UMC's headquarters in the Hsinchu Science-Based Industrial Park. As part of an update on UMC's manufacturing plans and corporate strategy, company officials gave journalists and analysts tours to show its fabs were fully back in production after September's powerful earthquake temporarily shut down all chip manufacturing in Hsinchu. The company also plans to complete a consolidation of its wafer fab structure to form a single corporate organization for higher efficiencies at the start of next year, Chang said. In 2000, UMC plans to be able to process copper interconnects for ICs in three of its eight fabs in Hsinchu. UMC is now shipping engineering samples of processed wafers with two and three layers of copper using a 0.18-micron technology, said Jenkon Chen, senior manager for UMC's logic development department. Customers are expected to move some of the early copper prototypes into volume production by the middle of 2000, he said. UMC officials said the company has invested $60 million in capital equipment to begin producing copper-metal interconnects. The early development work is being conducted under a partnership with tool suppliers Novellus Systems Inc. and Lam Research Corp. Next year, UMC said it expects to provide foundry services to more integrated device manufacturers (IDMs), which operate wafer fabs but have begun shifting more of their chip-processing volumes to third-party foundries. About 20% of UMC's capacity has been going to IDMs, but in 2000 that share will grow to about 35%, said CEO Chang. Over the long term, UMC believes about half of its foundry capacity will serve IDMs with the rest going to its traditional customer base of fabless chip houses.