Eyeing to expand in panel-level chip packaging, TSMC has procured a factory owned by Innolux in Southern Taiwan in exchange for 17.14 billion New Taiwan dollars.
Taiwan Semiconductor Manufacturing Company Ltd (TSMC) is expanding its production capabilities. It has announced a deal to purchase a plant and related assets from advanced packaging and panel manufacturer Innolux, located in the Southern Taiwan Science Park, according to a report by Liberty Times Net last week.
The facility, covering over 96,000 square meters, was acquired for NTD 17.14 billion, notably less than the estimated market value of around NTD 20 billion. TSMC has stated that the plant will be used for operational and manufacturing activities.
Regarding TSMC’s venture in panel-level packaging, industry experts have opined that transitioning from wafer-level to that is a more cost-effective solution. As chip die sizes typically increase by 5-10% on average, fewer chips can be produced from a single wafer, which puts added strain on wafer and packaging capabilities.
Given Innolux’s reduced post-capital share capital of NTD 79.8 billion, the transaction is anticipated to increase earnings per share by NTD 1.84.
Innolux recently sold its fourth Plant in Tainan City, a 5.5-generation LCD panel production facility. Reports suggest that TSMC offered a price 20% above the initial bid, and it plans to use the facility to advance its capabilities in advanced packaging technologies.
According to Liberty Times Net, sources at the Southern Taiwan Science Park have noted that TSMC’s existing plant is located in the northwest part of the park, while the newly acquired Innolux facility is in the southwest. Thus, the two facilities are not adjacent.
Previously, TSMC bought a plant from Hannstar, which it then dismantled and rebuilt due to panel factories’ differing design and construction needs compared to semiconductor fabs. TSMC also acquired a facility from E-Ton Solar Tech in the Southern Taiwan Science Park, which has since been repurposed as a smart warehouse.
