(Image courtesy of Infineon Technologies).

On Semiconductor Takes Majority Stake in Wafer Fab

On Semiconductor announced it would take over the majority of a shared factory to help meet mounting demand for power and analog semiconductors. The company said on Monday that it would pay Fujitsu Semiconductor for another 20 percent of the factory, located in the Japanese city of Aizuwakamatsu, giving it 60 percent of the output.

On Semiconductor said that it would raise its ownership stake to 100 percent in the first half of 2020. The company, which had previously taken over 40 percent of the 200-millimeter semiconductor fab, started wafer production in 2015. “This additional capacity will allow On Semiconductor to continue to scale its operations to meet forecasted demand and enable increased supply chain flexibility,” the company said in a statement.

The move underlines the recent renaissance in analog electronics. On Semiconductor has profited as these basic components are embedded into Internet of Things applications to support digital functions. Analog chip sales are growing the fastest in the industrial and automotive sectors. The company holds three-percent market share in analog semiconductors and more than 40 percent in the automotive image sensor market.

Infineon Technologies, the world’s largest maker of power electronics with around 18.5-percent market share, is aiming to boost its chip supply with a new $1.9 billion factory. The company has been grappling with voracious demand for power semiconductors that can manage electricity in electric vehicles and renewable energy systems like solar and wind. The Munich, Germany-based company plans to start building in the first half of 2019.

Alpha and Omega Semiconductor is also building a new factory in China, while ST Microelectronics expects to double its capital expenditures to around $1.2 billion this year. Texas Instruments, the largest supplier of analog chips, has also considered the construction of a new 300-millimeter wafer fab in Richardson, Texas. The company, based in Dallas, Texas, said that it could start building in 2019 with production in the first quarter of 2022. 

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