Officials at the Shanghai-based foundry refused to disclose the terms of the deal, or by how much the plant will boost its capacity.
The MOS-17 semiconductor production facility is in the northern city of Tiajin, and was estimated to have cost Motorola more than $1bn to build. It has however lain largely dormant as the worst downturn in the global chip industry rendered it unnecessary, despite the fact that a fifth of Motorola’s chip sales are in China.
SMIC will act as a strategic foundry partner to Motorola, both companies said in a statement. Motorola has retained an interest in MOS-17 by becoming one of the significant equity-holders in SMIC, and is entitled to a seat on SMIC’s board of directors.
There have been concerns that the growth in China’s chip production capacity has been too rapid, but SMIC is expecting an increase in prices this year as a result of an upswing in demand. The company has three fabs in Shanghai, and a fourth under construction in Beijing. The willingness to take on Motorola’s MOS-17 plant suggests considerable optimism over future demand.
This article is based on material originally published by ComputerWire.
