TSMC, Sony agree to joint venture for next-gen image sensors

Taipei, Aug. 11 (CNA) Taiwan Semiconductor Manufacturing Co. (TSMC) announced Tuesday that it will form a joint venture with Sony Semiconductor Solutions Corp. to develop next-generation image sensors.

In a statement, TSMC, the world's largest contract chipmaker, said the two companies had signed a legally binding definitive agreement to establish Advanced Vision Semiconductor Manufacturing Corp. in Koshi City, Kumamoto Prefecture, Japan.

TSMC said the new company will serve as a hub for the development and manufacturing activities needed to bring next-generation smartphone image sensors into commercial production.

The joint venture is scheduled to start commercial production in 2029, TSMC said.

According to the company, Sony Semiconductor Solutions will be the controlling shareholder and plans to operate the joint venture as a subsidiary of Sony Group Corp. The representative director of the new company will be appointed by Sony Semiconductor Solutions.

Under the agreement, Sony Semiconductor Solutions plans to contribute about 465 billion Japanese yen (US$2.92 billion) through a combination of cash and the transfer of assets via a company split, while TSMC plans to invest about 282 billion yen.

TSMC said the capital contributions will be made in phases, depending on market demand and business conditions.

The company added that the investment is premised on the joint venture receiving support from the Japanese government.

Under the strategic partnership, Sony Semiconductor Solutions will lead development of core image sensor technologies and product planning and design, while the joint venture will leverage TSMC's advanced-process technology and manufacturing expertise to facilitate development and manufacturing activities for commercial production.

The two partners "intend to accelerate the commercialization of image sensor products driven by customer needs while advancing technological innovation and strengthening manufacturing capacity," TSMC said.

TSMC said its board approved the joint venture at a two-day meeting concluded Tuesday.

The companies first announced the plan in May, when they signed a nonbinding memorandum of understanding.

TSMC currently operates its first advanced wafer fabrication plant in Kumamoto, which began commercial operations at the end of 2024 using specialty manufacturing processes. Construction of a second fab began last year, with mass production using the advanced 3-nanometer process scheduled to commence in 2028.