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Intel invests €3.3bn in ASML Holding for 450mm wafer research

Bigger wafers hold the key to profits
Tue Jul 10 2012, 12:15

CHIPMAKER Intel will invest €3.3bn into ASML Holding to push the development of 450mm wafers and extreme ultra-violet (EUV) lithography.

Intel has been talking up its 22nm process node and future process node shrinkage in the last year but the semiconductor industry, including Intel, has the equally tough task of transitioning from 300mm wafers to 450mm wafers. Intel announced that it will sink €3.3bn into dutch firm ASML Holding to develop 450mm wafer technology and the lithography needed to make it commercially viable.

Intel signed two agreements with ASML Holding that divide the €3.3bn into two tranches. The chipmaker will invest €553m over five years into ASML's research and development of 450mm lithography and a further €276m into EUV lithography as part of its second tranche.

While Intel will invest in research, its biggest investment will take equity in ASML, with the first tranche including a €1.7bn investment, followed by a €838m share purchase in the second tranche.

Brian Krzanich, Intel SVP and COO said, "The transition from one wafer size to the next has historically delivered a 30 to 40 percent reduction in die cost and we expect the shift from today's standard 300mm wafers to larger 450mm wafers to offer similar benefits. The faster we do this, the sooner we can gain the benefit of productivity improvements, which creates tremendous value for customers and shareholders."

The semiconductor industry has been stuck stamping out chips on 300mm wafers for a number of years. Firms can profit immensely from increases in wafer sizes as the manufacturing cost of making chips comes down considerably, however the production of 450mm wafers and more importantly the extremely fine lithography required to print chips on 450mm wafers are still in the research stage.

Given Intel's considerable equity stake in ASML, it wouldn't be surprising that, should the company crack the 450mm wafer nut, Intel might buy the rest of the firm to secure its considerable lead in chip production over its rivals.

Intel claims its investment in ASML Holding will reduce its time to production of 450mm wafers by two years. µ


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