United Microelectronics Corporation (NYSE: UMC; TWSE: 2303) (“UMC” or “The Company”), a global semiconductor foundry, today announced that its Board of Directors has approved a plan to build a new advanced manufacturing facility next to its existing 300mm fab (Fab12i) in Singapore. The first phase of this greenfield fab will have a monthly capacity of 30,000 wafers with production expected to commence in late 2024.
The new fab (Fab12i P3) will be one of the most advanced semiconductor foundries in Singapore, providing UMC’s 22/28nm processes. The planned investment for this project will be US$5 billion. UMC has operated as a pure-play foundry supplier in Singapore for more than 20 years and the location is also the company’s designated R&D center for advanced specialty technologies. To account for the Fab12i expansion, the company’s 2022 capex budget will be revised upward to US$3.6 billion.
The new fab is backed by customers who have signed multi-year supply agreements in order to secure capacity from 2024 and beyond, which points to robust demand outlook for UMC’s 22/28nm technologies for years to come, driven by 5G, IoT, and automotive mega-trends. Specialty technologies to be manufactured in the new facility, such as embedded high voltage, embedded non-volatile memory, RF-SOI, and mixed signal CMOS, are critical for a broad range of applications, including smartphones, smart home devices, and emerging electric vehicle applications. The company expects the new fab will play an important role in satisfying growing demand in these markets and help alleviate the structural shortage of foundry capacity, especially on 22/28nm processes.
Stan Hung, Chairman of UMC, said: “We are very excited to expand our 300mm operations in Singapore, which will enable the company to further diversify our manufacturing footprint. Over the past two decades, UMC has benefited from Singapore’s vision to attract high tech firms through strong infrastructure, ecosystem, and talent pool. Our Singapore fab is UMC’s flagship innovation hub and numerous new R&D projects in collaboration with customers will enter production when the new facility comes online. The semiconductor undersupply has crystallized the need for greater visibility and mutual risk mitigation within the industry. This investment is the result of the shared vision and close collaborations with our key customers. We are committed to doing our part to restore balance in the industry value chain and to the long-term success of our customers.”
Dr. Beh Swan Gin, Chairman of the Singapore Economic Development Board, said: “UMC plays an important role in Singapore’s semiconductor manufacturing sector. We strongly welcome and are pleased to support UMC in the expansion of its wafer fabrication and R&D operations in Singapore. This is in line with Singapore’s vision to further grow and deepen Singapore’s role in the global supply chain for semiconductors.”