Elpida Memory has plotted a three-year plan to raise its competitiveness in the global DRAM market and counter the threat from Samsung Electronics, according to industry sources in Taiwan.
Elpida plans to deepen its existing partnership with ProMOS Technologies in 2011, and expects to extend its cooperation with ProMOS and possibly other Taiwan-based fellow companies to jointly set up a manufacturing spot in China in 2012. During 2010, the Japan-based chip vendor has been focusing on providing capital and technology resources to support subsidiary Rexchip Electronics' operation.
Elpida president Yukio Sakamoto has said that the company is considering buying stakes of 20-30% in smaller Taiwan-based DRAM companies and the deals may lead to takeovers. Sakamoto named Powerchip Technology, ProMOS and Winbond Electronics as the possible targets for Elpida.
Elpida in 2009 turned Rexchip from an affiliate into a 64%-held subsidiary in a move to gain control of the Taiwan-based joint venture form its partner Powerchip. Rexchip began trading on Taiwan's emerging stock market on April 20, 2010, and re-elected its board of directors at its annual shareholders meeting in June. In addition, Rexchip has recently completed pilot runs for chips using a 40nm-class process, which will be the company's major production process around year-end 2010.
ProMOS in late 2009 announced a deal to manufacture chips based on Elpida's designs, after having brought an end to its long-term partnership with Hynix Semiconductor. ProMOS began deploying Elpida's 63nm (65nm-XS, Super-shrink) stack technology in March 2010 and three months later, it moved the node to mass production.
Elpida also has outsourcing contracts with Powerchip and Winbond. But ProMOS's plans to raise capital through rights issue or private placement later this year make it the most likely target of Elpida's investment, the sources said.
Elpida will likely apply for funding from the Japan government when it purchases a stake in ProMOS and also makes gains through licensing its 4Xnm technology, the sources speculated, adding capital remains a major concern.
Elpida's ultimate goal is to set up a 12-inch wafer fab in Suzhou, China based on some strategic alliances with its Taiwan partners, the sources claimed. The Japan-based chip vendor expects to utilize Taiwan's talent and experience to run a China-based fab, and seek investment incentives from the Suzhou municipal government.