Another 16MB DRAM plant bit the dust last week, when IBM Corp decided to sell its stake in the semiconductor plant in Boblingen Germany it jointly owned with Philips NV (CI No 3,467). The companies did not reveal the price Philips paid to take over the plant. Philips, which owns 51% in the joint venture, called Submicron Semiconductor Technology GMBH, will convert the plant to manufacture only logic chips, which it uses for its mobile phones. The 49% of the plant owned by IBM is devoted to 16MB DRAM production, and Philips will have to not only transform the existing DRAM production facility into a logic chip making plant, but also cut around 90 of the whole site’s existing 600 staff, a spokesperson said. Once it has taken over IBM’s stake, which it will do on January 1, 1999, Philips will take two to three years to ramp up its logic production to match the capacity of IBM’s DRAM facility, the spokesperson said. IBM’s decision to cut 16MB DRAM production in Germany falls into line with the current move to pull out of making 16MB DRAMs, which at current pricing are impossible to manufacture at anything but a loss. Siemens AG last week announced the closure of its plant in the North of England, and if the current price slump continues, the 16Mb chip production unit it runs with IBM near Paris may be the next for the chop. IBM has said it is currently evaluating the future of its 16MB production with Siemens at the site.
