UMC to expand 12-inch fab production from May 20

TAIPEI, TAIWAN: United Microelectronics Corporation (UMC) has announced that it will conduct a ceremony to mark the beginning of operations at the phase three and phase four production facilities located in its 12-inch Fab 12A in the Southern Taiwan Science Park (STSP) on May 20.

Though the company did not reveal any more details, sources in the industry believe that UMC’s plan to go ahead with the expansion of its 12-inch fab is an effort to cater to the rising demand from handset IC clients.

It had earlier planned to complete the installation of phase three equipment at its facility in STSP by Q3 and the new capacity was expected to begin functioning in Q4.

According to estimations by sources, UMC’s phase three facility at its Fab 12A will produce 500 wafers initially with monthly production of almost 15,000 units expected in the first half of the year 2011.

The new production lines will mainly produce 65 nm products. Plans are being drawn to produce 40 and 45 nm nodes as well. Sources reveal that UMC Fab 12A’s present capacity is at a total of 30,000 wafers per month. The level of the UMC 12-inch fab in Singapore (UMCi) is same as that of the one in Taiwan.

UMC’s competitor Taiwan Semiconductor Manufacturing Company (TSMC) has revealed that it is ready to expand its fifth phase at its 12-inch Fab 12 located in the Hsinchu Science Park (HSP).

TMSC will also expand its fourth phase of its 12-inch Fab 14 located in the STSP by the end of 2010. Plans to set up a third 12-inch fab were also announced by the company.

In a separate news, a plan by UMC to issue new shares amounting to 1.298 billion with a par value of NT$10 through private placement was approved bythe company’s board of directors.

The company hopes to gain strategic partners along with funds for operation, according to a company filing with the Taiwan Stock Exchange (TSE).