Infineon sells two backend power sites to ASE

Infineon sells two backend power sites to ASE

Business news |
By Nick Flaherty

Infineon Technologies is to sell two backend manufacturing sites for power and automotive to ASE alongside long term supply agreements.

The sites, one in Cavite, Philippines and one in Cheonan, South Korea, are part of Infineon Technologies Manufacturing Ltd and Infineon has signed long-term supply agreements for previously established services as well as services for new products to support its customers and fulfil existing commitments. 

ASE will assume operations with current employees, and further develop both sites to support multiple customers.

Infineon Technologies Power Semitech is a backend manufacturing site with around 300 employees. The fab is located in Cheonan, South Korea, about 60 miles south of Seoul. Infineon Technologies Cavite, is a backend manufacturing site with more than 900 employees. 

The deal implies that the backend plants, often old, amortized fabs, lacks scale and is a cost drain on the company. Infineon says its manufacturing strategy needs a balanced operations footprint combining in-house and external manufacturing to be profitable.

“By pooling manufacturing volumes in Cavite and Cheonan under a new owner and offering highest-quality manufacturing services to the overall industry, Infineon and ASE will be able to leverage mutual synergy potentials, thus generating attractive growth potentials for both companies,” said Infineon.

“We have excellent, highly competent teams and a great track record of highest quality standards at both sites, Cavite and Cheonan,” said Alexander Gorski, EVP and Head of Backend Operations at Infineon.

“ASE has been a trusted, strategic partner of Infineon for many years and will be an excellent new owner that will continue on this successful path and strengthen both fabs even further. The sale of our sites to ASE is in line with Infineon’s manufacturing strategy, provides mutual synergies and enables further growth while strengthening supply chain resilience”.

“Both the automotive and power management market segments are strategic focus areas for ASE,“ said Dr. Tien Wu, Chief Operating Officer of ASE.

“This acquisition of Infineon’s facilities in Cavite and Cheonan marks ASE’s strong commitment to form a strategic long-term partnership with Infineon in developing backend manufacturing solutions matching future growth opportunities. Given Infineon’s market leadership in automotive and power semiconductors and ASE’s leading position in backend semiconductor manufacturing, this partnership creates a win-win solution for the entire ecosystem from product companies to the end consumer.”

The transaction is expected to close towards the end of June 2024.;


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