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TIMC halves capital request from Taiwan govt

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CIOL Bureau
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TAIPEI, TAIWAN: Taiwan Innovation Memory Co (TIMC) has halved to T$5 billion a capital injection it requested from the government, which does not want its ownership in the new state-backed computer memory chip firm to exceed 50 per cent.

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TIMC, which was previously called Taiwan Memory Company and has an initial capital of about T$11 billion ($342 million), has requested up to T$5 billion from the government, Economics Minister Shih Yen-shiang told parliament on Thursday.

The amount is half the company's previously announced request for T$10 billion, partly as TIMC's core business would be in research and development.

Earlier this year, Taiwan's government announced the formation of TMC, which will use technology from Japan's Elpida Memory and jointly develop new chips.

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In July, the government said it had allocated T$30 billion in state funds to help the island's dynamic random access memory (DRAM) chip makers, who could submit restructuring proposals as they had been struggling in their worst-ever downturn.

TIMC is the only local chipmaker so far to request state capital before the government's deadline expires next week. Nanya Tech has also said it would present its own proposal.

"In TIMC's proposal, the company's operations will focus on R&D and it will also acquire some chip plants for production in the future," Shih said.

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"TIMC is a private enterprise and the government's stake won't surpass a half."

Chip packagers Siliconware and King Yuan Electronics (2449.TW: Quote, Profile, Research) have said they will invest in TIMC.

Taiwan's government will take three more months to decide who will get the funds and how much, though the entire process might be shorter.

The companies' proposals would have to include plans on developing technology with foreign firms and as well as strategies such as mergers and acquisitions.

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