GlobalWafers unveils expansion plans after bid for Siltronic fails

02/06/2022 08:35 PM
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Image taken from Google Maps
Image taken from Google Maps

Taipei, Feb. 6 (CNA) Taiwan's GlobalWafers Co., the world's third-largest silicon wafer supplier, on Sunday announced investment plans after the clock ran out on its efforts to gain regulatory approval from the German government to take over German wafer manufacturer Siltronic AG last week.

The plans include spending NT$100 billion (US$3.59 billion) on capacity expansion from 2022-2024, the company said during an online conference that day.

The funds were originally set aside for the acquisition of Siltronic and will now be earmarked for capital and operating expenses over the three-year period, including substantial greenfield investments, the company said.

Doris Hsu (徐秀蘭), chairwoman and CEO of GlobalWafers, said that although the bid to acquire the German company failed, the firm has pursued a dual-track strategy from the beginning of the tender.

"I am very excited that we can now consider a broad range of options to advance technology development and enhance our capacities," she added.

GlobalWafers is considering a number of brown and greenfield capacity expansion plans, including 12-inch (300mm) wafers and epitaxial wafers, 8" and 12" silicon on insulator wafers (SOI), as well as 8" float-zone wafers (FZ), silicon carbide (SiC) wafers (including SiC Epi) and gallium nitride on silicon wafers (GaN on Si), as well as other large-size next-generation products, according to the company.

The expansion plan includes investments of up to NT$100 billion in both brown and greenfield projects in Asia, Europe and the United States. The new production lines are expected to ramp up in the second half of next year and be expanded quarterly, the company said.

GlobalWafers said that it will implement the expansion plan after the Jan. 31 deadline for it to obtain approval from Germany's Federal Ministry for Economic Affairs and Climate Action for a US$4.89-billion takeover of Siltronic expired without action from the ministry.

Hsu attributed the failed acquisition of Siltronic to its inability to obtain approval from the German government before the deadline for the deal to be completed, but added that the unsuccessful bid does not mean the company will not merge with or acquire another business in the future.

Hsu told reporters that the German government asked for antitrust approval for the deal from the Chinese authorities before reaching a determination on its review of the transaction.

However, China's decision on the matter came too late for Germany to consider. GlobalWafers received the written Chinese documents and handed them over to the German government on Jan. 26, Hsu added.

Asked whether the company will continue to talk with the German government, Hsu did not respond.

GlobalWafers holds 13.67 percent of Siltronic shares and there are no restrictions on how it can trade those shares in the future, according to Hsu.

However, according to the merger agreement with Siltronic, GlobalWafers has to pay a termination fee of 50 million euros (US$57.25 million) since regulatory approval was not obtained, Hsu added.

(By Tsai Peng-min, Chang Chien-chung and Evelyn Kao)

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