IBM, Seiko Epson may tie-up on chip venture

TOKYO: International Business Machines Corp and electronics maker Seiko Epson

Corp said on Thursday that they had agreed to set up a joint venture in Japan to

make logic chips for cellphones, handheld computers and other networked devices.

A Tokyo-based IBM spokeswoman said the semiconductors would be produced at an

IBM facility in Yasu, Shiga prefecture, northeast of Kyoto, although the

companies had not yet finalized details regarding the amount of investment,

production capacity or the split of ownership between the two.

The firms, in a statement, said they expected to reach a final agreement on

the venture by June-end. The venture will make chips from 300mm silicon wafers,

which yield more chips and thus trim costs compared with traditional 200mm

wafers.

It will also be IBM's first facility in Japan to use 0.13-micron processes,

the spokeswoman said. Chipmakers now widely use 0.18-micron technology, although

several are gradually shifting to 0.13 micron. Narrower widths allow more

circuitry to be fitted on a chip and reduce power consumption.

Unlisted Seiko Epson is a leading producer of ink-jet printers and has been

expanding its operations in electronic parts and chips for handheld

communications devices.

(C) Reuters Limited 2001