South Korea's No. 2 chipmaker, SK hynix Inc., said Tuesday it will establish a joint venture in China to build a new 200 mm wafer analog foundry production line.

The chipmaker said its wholly owned subsidiary SK hynix System IC Inc. will build a new production line in the second half of this year in Wuxi, eastern China, along with Wuxi Industrial Development Group, an investment firm run by the regional government.

SK hynix System IC, launched last year, focuses on its foundry business, which makes chip designs for other companies that do not have semiconductor fabrication plants.

There has been a rumor that SK hynix has been seeking to open a joint venture in China to expand its foundry business after the launch of the sister company.

SK hynix plans to relocate some of the foundry equipment in South Korea to China but to retain research and development-related facilities here.

The construction of the new factory is expected to be completed in the second half of 2019. SK hynix said it will ship its production facilities from its Cheongju production line, 130 kilometers southeast of Seoul, to its new Chinese plant throughout 2021.

SK hynix System IC will operate the joint venture by investing facilities, including semiconductor production devices, and Wuxi Industrial Development Group will support other necessary infrastructure efforts.

Industry watchers said the project should be seen against a backdrop of SK hynix System IC's aging M8 factory in Cheongju and the company's search for new business opportunities in China, where the demand for analog chips has been expanding.

An official from the company said SK hynix is seeking to ease its dependency on DRAM and NAND flash products and to foster new growth engines.

By: DocMemory
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