Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (1592)	7/17/2002 10:15:59 PM
From: Proud_Infidel	Read Replies (1) \| Respond to of 25522

Microchip to buy wafer fab from Fujitsu Company also reports flat profit on 15% increase in revenue EBN (07/17/02 18:36 p.m. EST) Microchip Technology Inc. announced today that it has executed an agreement to acquire a semiconductor manufacturing complex in Gresham, Oregon from Fujitsu Microelectronics, Inc. for $183.5 million in cash. The Gresham facility, which the company is referring to as "Fab 4," will substantially enhance Microchip's short-term and long-term global manufacturing capacity and will help accommodate Microchip's projected worldwide demand for its field-programmable microcontrollers, analog, Serial EEPROMs, and complementary microperipheral products, it said. Initial hiring is expected to reach approximately 60 people during pre-production phases. Over time, Microchip believes it could employ approximately 360 people as the facility reaches high volume manufacturing capacity over the next 5 to 6 years. The transaction is subject to results of Microchip's due diligence and other closing conditions. Closing of the transaction is expected to occur by the end of October, however, Fujitsu Microelectronics has the option to accelerate closing to the end of August 2002 upon completion of all closing conditions. Situated on a 196-acre campus east of Portland, the Gresham campus comprises approximately 826,500 square feet, including approximately 200,000 square feet of clean room space. The facility is designed to be capable of producing process technologies down to 0.13-micron and to support more than $1 billion in annual sales at full capacity. The facility comes equipped with approximately 350 process tools and 170 support tools, which will reduce the time required to commence production. Microchip plans to initially produce 8-inch wafers on its 0.5-micron and 0.35-micron process technologies at the Gresham facility. The facility will also house manufacturing operations, offices, meeting rooms and support functions. Microchip currently expects volume production to commence at the facility by July 2003. Microchip currently intends to maintain its Fab 3 (Puyallup, Washington) manufacturing facility until it is required for future production. Microchip is, however, evaluating its Fab 3 facility to determine if an impairment charge would be required. Microchip will relocate the process equipment from Fab 3 to its wafer fabrication facilities in Tempe and Chandler, Arizona, to further enhance the company's short-term manufacturing capacity and to reduce its otherwise planned capital expenditures. Following the closing of the acquisition of the Gresham, Oregon facility, Microchip intends to relocate certain equipment from Fab 3 to Fab 4 to create a closer equipment match to the company's Tempe wafer fabrication facility in order to facilitate a quicker process start at Fab 4. "Without Fab 4, we believe we would have had sufficient manufacturing capacity through the end of September 2003, at our current rate of growth. Beyond that, we would need to add substantial new advance manufacturing equipment at 0.5 and 0.35 micron process technologies in our Tempe, Arizona wafer fabrication facility and at Fab 3 in Puyallup," the company said. "This acquisition will provide us with extremely cost effective additional manufacturing capacity in a much shorter time frame and on more favorable terms than either the expansion of our Tempe fab or the start up of Fab 3 in Puyallup. "The acquisition of this facility will also accelerate Microchip's technology roadmap. Because of the availability of sufficient advance manufacturing equipment, Microchip will be adding a 0.25 micron advance Technology Development Program in Fab 4 and will relocate certain personnel from its facility in Tempe, Arizona. These actions will preserve Microchip's captive and very cost effective manufacturing strategy to process technologies up to 0.25 microns and below," it added. The acquisition is subject to several closing conditions, including the qualification of the facility under Oregon's Strategic Investment Program that caps the property taxes similar to the programs currently granted to Intel Corp. and LSI Logic. Separately, Microchip said its fiscal first quarter net income in the three months ended June 30, was largely unchanged at $21.7 million, or 10 cents a share, from $21.8 million, or 11 cents a share in the year-ago comparable quarter. A charge of $9.3 million in the recently ended quarter cut into Microchip's net income while earnings per share fell from the year-ago quarter due to a small increase in the number of shares outstanding. Revenue rose 15%, to $159.8 million from $138.9 million in the June 2001 quarter as the company's analog customer base expanded leading to a 16% rise in analog sales while microcontroller sales increased 6%. The company said it sees September-quarter sales rising 7%, to $171 million, on continued strength in its proprietary product lines.

To: Gottfried who wrote (1592)	7/17/2002 10:51:09 PM
From: Rajiv Hargunani	Read Replies (1) \| Respond to of 25522

Gottfried, I am glad I could post some information here. I believe some of the folks here are much more informative than these ANALysts. Any thoughts how the semis did in the week of the SEMICON West Conf in the previous down cycles ? Right now am just confused about the whole damn markets and have actually being playing both sides (quite profitably) for short term trades. I am holding 2000 sh of AMAT since 95, at avg price of $5.20. I have written 15 Oct 25 calls, I hv 5 Aug 17.5 puts. So basically a collar strategy i.e. paying for the puts with the calls that I sold. Given the outlook from Intel, Klic, Ter I will be surprised if AMAT approaches 25 by Oct. I dont plan to hold any option till expiration and will close them out before that. Hasn't klic usually been the sort of precursor for the industry ? If they are saying business isn't improving, will that not affect the rest of semi equips? I will be interested to hear what folks think AMAT will say on Monday. Regards -Rajiv