TI snaps up bargain chip factories in Japan

TI will keep one factory running in Japan and shift equipment from the other to the U.S.

Texas Instruments on Wednesday agreed to buy two chip factories in Japan, adding to other distressed chip assets its been able to purchase since the global recession hit last year.

The U.S. chip maker will buy the factories and their equipment from Spansion Japan as part of a court-approved plan of reorganization for the Japanese company. Spansion Japan filed for bankruptcy protection last year, after the global recession hurt sales and its parent company, Spansion, also filed for bankruptcy.

TI said one of the factories, an 8-inch (200-millimeter) wafer fab, will remain open in Japan, while equipment from the other factory, a 12-inch (300mm) fab, will be moved to another TI factory in Richardson, Texas.

The 12-inch factory will be kept for future capacity needs, TI said in a statement. The company plans to offer jobs to most workers at the Aizu-Wakamatsu, Japan, factories.

TI did not say how much it paid for the two chip factories, but called the purchase a cost-effective way to increase production capacity for analog semiconductors, its main business. TI chips are used in a range of devices, from e-readers and smartphones to robotics and LED streetlights.

This is the second major purchase of distressed assets by TI over the past 12 months. Last year, the company paid a bargain US$172.5 billion for chip production equipment from a 12-inch fab owned by Qimonda after the DRAM maker filed for bankruptcy in Germany. Early this year, TI said it bought more tools from Qimonda.

In all, the purchases and other spending by TI over the past 24 months will add capacity for US$3.5 billion per year in additional revenue when its all up and running, the company said.

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