SilTerra Malaysia Sdn Bhd (“SilTerra”), Malaysia’s largest semiconductor wafer foundry, is investing RM645 million on an expansion plan that will increase its annual capacity by 20 per cent.
The investment, sourced from both capital injections by shareholders and internally generated fund, will increase SilTerra’s annual capacity from 8.3 million as at end of July 2021 to 10 million mask layers. The additional capacity is expected to be ready for production by early 2023.
According to Tan Sri Syed Zainal Abidin Syed Mohamed Tahir, Group Managing Director of DNeX, and also Executive Chairman of SilTerra, the investment is the shareholders’ on-going commitment to equip the company with best-in-class manufacturing capabilities and expand the production capacity to achieve a better economy of scale, with lower manufacturing cost.
“The initiatives implemented thus far to transform SilTerra into a profitable and resilient technology company have yielded fruitful results. In the past six months, our debottlenecking and process improvements exercise have resulted in improved productivity and efficiency levels,” he said.
“As a result, SilTerra is now a profitable entity and is well-poised to grow further in view of the continuous strong demand for semiconductors and prevailing capacity constraints within the industry due to the high demand of electric vehicles, Internet-of-things (“IOT”), data centres and electronic commerce. This demand is particularly relevant especially for the 200mm specialty foundries where SilTerra is in. Hence, it is prudent for us to continue our long-term investment programmes for SilTerra to cater to the rising demand,” he added.
Moreover, he said the support from SilTerra’s customers is very strong.
“The recently inked long-term agreements (“LTAs”) with ChipOne Technology (Beijing) and Taiwan-based ILI Technology will provide a stable business for SilTerra in case a market downturn happens. Apart from the business these LTAs will bring, SilTerra is committed to work with our customers to improve the technology cooperation to further strengthen and optimise the product and technology roadmap among the parties,” said Tan Sri Syed Zainal Abidin Syed Mohamed Tahir.
“All in all, the execution of our business roadmap has been progressing well. Alongside the continual positive outlook of the semiconductor industry and our investment, we believe there is still ample room for SilTerra to deliver stronger results moving forward,” he added.