Shanghai Huahong Group on August 2 struck a deal with the national China Integrated Circuit Industry Investment Fund and the city government of Wuxi to set up a new 12-inch wafer fab in Wuxi with total investment estimated at around US$10 billion.

Construction of the new 12-inch fab in Wuxi will be in two phases. Phase one of the fab will be ready for volume production two years later, with monthly capacity reaching 40,000 wafers manufactured using 65nm and 90nm process technologies. Construction of the second phase will depend on market situations, said Huahong, without elaborating further.

Eight-inch foundry Huahong Grace Semiconductor Manufacturing (HHGrace) and 12-inch foundry Huali Microelectronics (HLMC) are under the Huahong group. HHGrace currently runs three 8-inch fabs, while HLMC broke ground for its second 12-inch fab at the end of 2016.

HHGrace is being identified as the likely foundry operating the new 12-inch fab in Wuxi, according to industry sources.

HHGrace offers foundry services for embedded flash, discrete components, logic, RF, analog and power management (PWM) chips, EEPROM and NOR flash chips. HHGrace has long been targeting the smart card, MCU, car electronics and CMOS image sensor sectors, and recently stepped into the manufacture of chips for IoT applications with its technology solutions extended to 90nm process.

Major China-based smart card chip developers including Shanghai Fudan Microelectronics, Datang Microelectronics Technology, Unigroup Guoxin (formerly Tongfang Guoxin Electronics) and Nationz Technologies are reportedly among HHGrace's clients. Handset-related ICs mainly peripheral chips are another target segment of HHGrace.

Founded in 2010, HLMC is a dedicated 12-inch foundry service provider offering 55nm and more advanced process technologies. HLMC is constructing its Fab 2 that will directly enter 28nm production. Equipment will start to be installed at HLMC's Fab 2 in early 2018, followed by volume production by the end of the year.

By: DocMemory
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