DuPont Photomasks, Infineon, AMD lay out ambitious photolith plans

Dresden, Germany — Infineon Technologies AG, Advanced Micro Devices Inc., and DuPont Photomasks Inc. plan to establish and operate a new advanced photomask facility in Dresden, with investments of around EUR 360 million over the next five years.

The facility will be used to develop and pilot-manufacture next-generation lithographic photomasks for exposing patterns on semiconductor silicon wafers. For this purpose, the three companies are creating a new, equally owned joint venture, Advanced Mask Technology Center GmbH & Co. KG (AMTC). The AMTC facility will be co-located with a new commercial photomask production facility that DuPont Photomasks will establish in Dresden as a separate entity.

The building, which is planned to house the two companies, has a useable floor space of 17,500 square meters. It will be constructed in the immediate vicinity of Infineon’s and AMD’s Dresden-based semiconductor fabs. The completion date for construction is scheduled for early 2003. As soon as the building is in place, AMTC and DuPont Photomasks plan to install the necessary equipment and begin start-up of the operations in the second half of 2003. AMTC expects to employ around 170 people. Key engineers from all three companies are expected to staff the AMTC and will collaboratively develop a roadmap for technology nodes of 90-65nm and below.

Infineon already operates a photomask development and production facility with around 230 employees in Munich, producing masks exclusively for Infineon’s worldwide production facilities. With this strategic shift, Infineon is pulling out of the complete mask development on its own in favor of a cooperation model in the area of high-end-masks designed to speed up development cycles and to reduce costs.

Infineon’s leading-edge photomask technology, as well as AMD’s and DuPont Photomasks’ technology, will be used in the new venture in Dresden. Employees of the Infineon Munich photomask facility will be encouraged to apply for comparable jobs at the AMTC, at the new DuPont Photomasks facility in Dresden or at Infineon in Dresden.

As to the status of the RTC in Texas, a joint facility run by DuPont Photomask, Micron and Motorola, Peter Kirlin, CEO of DuPont Photomask, noted that the agreement is scheduled to end by the end of CY02. Micron, Kirlin noted, is building a similar facility in Boise, ID, and DuPont is talking with the chipmaker about what sort of partnership makes sense. Similar discussions are progressing with Motorola, Kirlin said.

In a separate agreement announced today, DuPont Photomasks has been selected as Infineon Technologies’ strategic photomask supplier, as the two companies entered into a 10-year supply agreement. As part of that agreement, DuPont Photomasks plans to build a state-of-the-art, commercial production photomask facility in Dresden, to support the advanced photomask needs of its global customers, including Infineon.

Operations at the new facility are slated to begin in late 2003.

During DuPont Photomasks’ fiscal 2003, the supply agreement with Infineon is expected to add approximately $14 million in revenues and in fiscal 2004, approximately $42 million in revenues. As DuPont Photomasks’ new facility in Dresden ramps to volume production in the middle of fiscal 2004, Infineon plans to fully exit the internal production of photomasks and use DuPont Photomasks as its commercial supplier. The company estimates Infineon’s current photomask demand at $50 million to $60 million annually.

Also under the terms of the agreement, in consideration for certain photomask production assets acquired within 18 months and the 10-year supply agreement, DuPont Photomasks will pay Infineon approximately $53 million over seven years. In addition, DuPont Photomasks intends to purchase from Infineon additional photomask production assets for $28 million paid out over four years. The deal is expected to add approximately $0.10 per share to DuPont Photomasks’ fiscal 2003 earnings and approximately $0.35 per share in fiscal 2004.

DuPont plans to invest approximately $155 million over the next five years in the new commercial production facility in Dresden. At full production, the company expects to employ nearly 200 people. The Dresden facility, along with other facilities in DuPont Photomasks’ manufacturing network, will be used to meet the terms of the global supply agreement with Infineon. The supply agreement includes Infineon’s affiliates, joint-venture alliances and fabs, such as ProMOS and UMCi. DuPont Photomasks will serve other customers through the Dresden facility, as well.

Dr. Andreas Von Zitzewitz, board member and COO of Infineon, noted that Infineon would be using lithographic photomasks made in Dresden for its chip facilities in Germany, France and the United States. In addition, partner enterprises like ProMOS, UMCi and Winbond would also be supplied with photomasks. Von Zitzewitz predicted that “in the medium term, the Advanced Mask Technology Center in Dresden will become Infineon’s new driver for semiconductor development.

Dr. William Siegle, AMD senior vice president, technology operations and chief scientist, stated, “AMTC, which builds on our successful past relationship with DuPont Photomasks, is an ideal supplement to our AMD Fab 30 semiconductor facility, and will contribute to further strengthening Dresden as a microelectronics center. As early as 2003, we expect the AMTC to support one of the world’s most successful fabs – our Fab 30.

“The advantages of having a photomask facility in immediate proximity to our fabs is self-evident: It means the shortest possible distance between the AMTC development center and our plants, which depend on “just-in-time” deliveries of increasingly complex photomasks. Thanks to the direct feedback between our wafer fabs and the photomask facility, all three partners will be able to help ensure high-level performance on the part of AMTC. In the global semiconductor industry, this is an important key to success.”

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