Semiconductor Value Chain

Argentina Set to Save Brazilian Wafer Fab

14 January 2014

Eduardo Eurnekian, an Argentinian billionaire, is set to buy a 33 percent stake in the SIX Semiconductores wafer fab from struggling Brazilian counterpart Eike Batista, according to reports. Batista has been seeking to divest himself of his holding in the wafer fab since the collapse of his commodities-based business in 2013.

Much of the impetus for the SIX Semiconductores wafer-fab project, for which funding was announced in 2012, has come from the Brazilian government through the Brazilian development bank BNDES. However, Batista's EBX Group holds a third of the equity and had failed to put up all the cash it had promised, the report stated.

BNDES holds another 33 percent stake and IBM reportedly has an 18 percent stake in the company, granted in return for manufacturing process technology and support.

Now Eurnekian's Corporacion America has reached a deal to buy Batista's stake and provide 164 million reals (about $70 million) for investment in the wafer fab, the report said referencing unnamed officials in the Minas Gerais state government. The deal will put the wafer fab back on course to be finished by mid-2015, the report said.

The wafer fab is being built in Ribeirao das Neves, in the metropolitan area of Belo Horizonte, the capital of Minas Gerais state. Back in 2012 the SIX Semiconductores project was expected to cost about 1 billion reals (about $500 million) and to be to be operational in 2014.

Corporacion America has its own electronics factory called Unitec Blue south of Beunos Aries, which makes smartcards for public transportation, credit cards, and subscriber identity modules (SIMs) for mobile phones. Unitec Blue is a packaging facility in its first phase that relies on imported wafers but with plans for a second phase where it would also perform front-end processing. In this second phase Unitec Blue would make solar cells, LEDs, memory devices, sensors and printed batteries the website claims.

However, the acquisition of an interest in SIX Semiconductores could modulate that allowing the Brazilian wafer fab become the source of at least some of wafers for Unitec production.

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