(November 29, 2010 – Asia Pulse) — Japan’s Fujitsu Semiconductor Ltd. will transfer its flip chip mounting technology to a Chinese group affiliate for system chip assembly.

Flip chip mounting attaches semiconductor chips directly to boards with solder bumps, eliminating the need for metal lead wires. This speeds assembly, enables chips to be designed thinner, and reduces power consumption.

Before the end of the year, the Fujitsu Ltd. (TSE:6702) arm will transfer some of the manufacturing equipment from its main domestic factory in Mie Prefecture to Nantong Fujitsu Microelectronics Co (SSE:002156), a Jiangsu Province joint venture in which the Fujitsu group owns a roughly 20% stake.

This will mark the first time that a leading Japanese chipmaker transfers such advanced mounting technology to China. Fujitsu Semiconductor is doing this to strengthen Chinese operations and better compete with rivals like Texas Instruments Inc. and Renesas Technology Corp., which have bolstered their own production operations in China to cut costs.

Fujitsu Semiconductor will also collaborate with Nantong Fujitsu to open an R&D center in the city of Nantong this December. The company will dispatch engineers to this center so they can work with Chinese counterparts to develop chip assembly technologies meeting the needs of China’s electronics manufacturing service providers.

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