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 : Alliance Semiconductor -- Ignore unavailable to you. Want to Upgrade?

To: DJBEINO who wrote (2371)	1/19/1998 1:31:00 PM
From: DJBEINO	Read Replies (1) \| Respond to of 9582

Asian currency slip delays Samsung equipment buy Austin Business Journal, Monday, January 19, 1998 at 11:54 Samsung Corp., feeling the effects of the Asian currency turmoil, will delay by at least a few months the purchase of $500 million worth of chip-making equipment for its Austin plant. Construction of the plant is done and chipmaking has begun. Much of its equipment is already in place, but the rapid fall of the Korean currency - the won - has roughly doubled the cost of chip-making equipment required to bring the plant to full capacity. The plant's first completed phase brought its capacity to 12,000 eight-inch silicon wafers produced every month. The second phase will eventually bring the plant to 25,000 wafers a month, but it has been delayed. "We don't want to spend any more than necessary," says Bill Cryer, spokesman for Samsung Austin Semiconductor. "Right now, I'd guess that we're going to delay {the second phase equipment buys} by one or two months." Wafers produced at the plant in Austin contain hundreds of dynamic random access memory chips. The wafers are shipped to Korea, where the DRAM chips are cut from them. The chips are then packaged and sent back to the United States for shipping to customers. Cryer stresses that Samsung's plant here is finished and fully operational, and says the second phase delays have little long-term importance. Originally, the second phase was scheduled to be completed by early summer. "From the outside, these changes will be unnoticeable," Cryer says. "The {equipment} move-in date is always a bit slippery anyway." Samsung, which has hired 900 employees here, moved into its Austin facility in August and began test production in September. The plant will ship its first chips to customers this month, Cryer says. Samsung has spent about $800 million of the estimated $1.3 billion required to equip its Austin plant. Jim Handy, an analyst with San Jose-based Dataquest, says Samsung has "put the brakes" on all capital spending except for 250-megabit chip development, and environmental and safety equipment. Ashok Kumar, an analyst with Lowenbaum & Co. in Austin, says Korean companies are trimming capital expenditures by at least 30 percent across the board. He says Korea's chaebols, or industrial groups, of which Samsung is the largest, formerly tried to expand into every facet of industry. "They will have to rationalize their business plan going forward," Kumar says. Among its early austerity measures, Samsung has sold one of its divisions, Samsung Microwave Semiconductor, to Watkins-Johnson Co. for less than $10 million.