Korean firm, Phoenix Semiconductor Philippines Corp., is investing $172 million to produce a new memory chips for smart phones and expand production capacity of its existing memory chip manufacturing for servers and personal computers. The additional investment puts the Philippine production line on equal footing with its Korean headquarters.
Kim Dong Joo, PSPC CFO and Vice President, said the 15-hectare factory in Clark Economic Zone is being groomed to become the flagship of its memory chip production base.
PSPC employs 1,550 workers; the new line would entail the recruitment of another 1,000 workers.
PSPC s products are manufactured for Samsung Electronics Co. Ltd. under a 6-year midterm contract covering the period 2011 to 2017.
Those chips carry Samsung brand and go to Samsung s internal use and to Samsung s customers including fierce rival Apple.
From the $172 million, the bulk of $170 million will be invested in one or two new buildings which will produce some 40 million units of memory chips that would be used for smart devices.
The $2 million will be invested to increase the capacity of its current line that produces memory chips for servers and PCs raising the production to 65 million from 60 million units. This year s exports is to hit the $234 million mark, a jump from $210 million, mainly due to the expansion of the current line. The company has invested $700 million in the Philippines since January 2010. PSPC currently supplies about 25% of Samsung s requirement for DRAM (dynamic random access memory). Under the contract with Samsung, PSPC guarantees most of the plant capacity per month. PSPC is 1 of 5 OSAT (outsourced semiconductor assembly and test) that provide manufacturing services to Samsung but the only 1 equipped with the facility and infrastructure to provide the full range of assembly, test and module. PSPC is part of Bokwang Group through its parent STS Semiconductor & Telecommunication Co. Ltd. To fund the expansion, PSPC plans to raise P2 billion in an initial public offering of its shares. It will also tap loans and internally-generated funds to bankroll the projects.
PSPC plans to sell 286 million primary shares and another 286 million secondary shares equivalent to 25% of the company s existing stocks.