The China foundry was expected to file for the offering this quarter, but questions arose as to that possibility when TSMC in December 2003 announced a suit against the company over patents and trade secrets. In the Securities and Exchange Commission filing today, SMIC said it would "vigorously" fight TSMC's charges, but admitted that the cost of litigation will be substantial and, if the court rules in TSMC's favor, further costs will affect its financial standing.

Plans for the IPO include bumping up wafer output to boost business. In doing so, SMIC said it will invest $1.95 billion and $1.37 billion on capacity expansion in 2004 and 2005, respectively – a move that will keep the rapid ramp-up pace SMIC has set for itself.

In the filing, SMIC disclosed that by the end of 2002 it had recorded no earnings from 0.15-micron and 0.13-micron processes, and only 4.7 percent of its wafers were used 0.18-micron technology. At the end of 2003, the then 3-year-old company saw 0.18-micron representing 22 percent of wafers, 0.15-micron at about 10 percent and 0.13-micron accounting for nearly 12 percent.

By: DocMemory
Copyright © 2023 CST, Inc. All Rights Reserved