Indian firm Reliance Industries is in talks to buy Israel's Thal Semiconductor
According to media reports, Indian firm Reliance Industries is in talks to buy Israel's Thal Semiconductor.
The news was released shortly after Intel abandoned plans to buy the Israeli company.Reliance's acquisition, if successful, would provide the group with an entry into the semiconductor sector and could accelerate India's ambitions to set up a fab in the country.
Reliance has the financial muscle, which could revitalize India's ailing ambition to set up its own fabs. Further helping Reliance is the fact that the organization is known to be close to the current government, which makes it easier for them to work closely together. Additionally, having a chip manufacturing arm will help Reliance protect its telecom and equipment divisions from chip shortages.
The COVID-19 pandemic exposed the extremely fragile nature of the semiconductor supply chain, leading to a severe shortage of chips. This has prompted several countries, including India, to try and develop their own chip manufacturing capabilities.
Tower Semiconductor produces advanced analog integrated circuits and has more than 300 customers from industries as diverse as aerospace, defense and automotive. However, the ongoing conflict in Israel now reportedly could delay negotiations.
The Tata Group is another Indian conglomerate interested in entering the chip manufacturing space. The Tata project is building Micron Technology's semiconductor assembly and testing plant in Gujarat. According to media reports, the Tata Group had also been looking for land to set up a chip manufacturing unit in Tamil Nadu earlier this year.
The Indian government plans to offer $10 billion in incentives to encourage fab companies to set up fab units in the country. It has also set up the India Semiconductor Mission (ISM) to help companies set up manufacturing units to meet the growing demand for chips in the country.
However, it has been difficult for applicants to find technology partners to set up the country's semiconductor sector. vedanta and Foxconn initially set up a $19.5 billion joint venture, but later decided to go independent with their chip-making plans. Singapore's IGSS Ventures and Tower Semiconductors, as well as Taiwan's ISMC, are other applicants in the program.
Previously: Intel Announces Termination of Tower Semiconductor Acquisition
In August, Intel Corporation announced that it had agreed with Tower Semiconductor to terminate its previously disclosed agreement to acquire Tower due to its inability to obtain a license to acquire Tower. Under the terms of the merger agreement and the merger agreement associated with the termination, Intel will pay Tower a termination fee of $353 million.
"Our foundry efforts are critical to unlocking the full potential of IDM 2.0, and we continue to drive all aspects of our strategy," said Pat Gelsinger, Intel executive. "We are executing well on our roadmap to regain transistor performance and power performance leadership by 2025, building momentum with customers and the broader ecosystem, and investing to deliver the geographically diverse and resilient manufacturing footprint the world needs. Through this process, our respect for Tower has grown and we will continue to look for opportunities to work together in the future."
Stuart Pann, vice president and general manager of Intel Foundry Services (IFS), said, "Since launching in 2021, Intel Foundry Services has won over customers and partners, and we've made significant progress toward our goal of becoming the second manufacturer - external foundry in the world by the end of the century. As the world's open-systems foundry, we are building a differentiated customer value proposition with a portfolio of technologies and manufacturing knowledge that goes beyond traditional wafer fabrication, including packaging, small-chip standards and software."
In September, Intel said it would provide Tower with foundry services and 300mm manufacturing capacity. As part of the deal, Tower will use Intel's facility in New Mexico, which is operated by Intel Foundry Services (IFS) and invested up to $300 million to "purchase and own equipment and other fixed assets" that will be installed in the manufacturing facility.
The deal will provide Tower with a new capacity corridor of "more than 600,000 photoreceptors per month" to meet the expected demand for 300mm chips. The deal means that Intel will produce Tower's 65nm power management BCD (bipolar-CMOS-DMOS) process.Tower itself also has manufacturing facilities in Israel (150mm and 200mm), the US (200mm), Japan (200mm and 300mm) and will soon have a manufacturing facility in Italy in partnership with STMicroelectronics.
"Our long-term goal with the launch of Intel Foundry Services is to provide the world's first open systems foundry, combining a secure, sustainable and resilient supply chain with the strengths of Intel and our ecosystem. We are pleased that Tower saw the unique value we offer and chose us to open up their 300mm U.S. capacity corridor." Stuart Pann, Intel vice president and general manager of Intel Foundry Services, said in a statement.
Russell Ellwanger, Tower executive officer, added, "We are pleased to continue our partnership with Intel." "Looking ahead, our primary focus is to expand our customer partnerships through the mass manufacturing of leading technology solutions. Our partnership with Intel allows us to address our customers' demand roadmaps, with a particular focus on advanced power management and radio frequency silicon-on-insulator (RF SOI) solutions, with a full process flow planned for 2024. We see this as a step towards creating multiple unique and synergistic solutions with Intel."
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