Under the agreement, Agilent will sell a 15% stake in the Chartered Silicon Partners (CSP) joint-venture fab to Singapex Investments Pte. Ltd., which is a wholly-owned subsidiary of Singapore Technologies Pte. Ltd., and EDB Investments Pte. Ltd. The investment firms have agreed to purchase equal portions for an undisclosed amount.

After the sale, Chartered, EDBI, Agilent, and Singapex will own 51%, 26.5%, 15%, and 7.5% of the CSP 8-inch fab, respectively. The sale is a result of the prolong downturn in the semiconductor industry, said the partners, which signed the agreement today.

"The Agilent-Chartered relationship remains extremely strong, and we expect to continue working with Chartered as our primary foundry partner," said Bill Sullivan, senior vice president and general manager for Agilent's Semiconductor Products Group.

Sullivan said Aglient has already selected Chartered as its supplier of 0.18-micron ICs and it is now designated as the foundry for 0.13-micron semiconductors, which are expected to be in production in 2003. "Agilent continues to transfer a variety of new products to Chartered," Sullivan said. "We are pleased that the CSP ownership agreement could be modified in a manner that better meets our near-term business needs and we look forward to continuing to partner with Chartered on multiple levels."

However, the reduction in ownership automatically lowers Agilent's maximum capacity entitlement from Fab 6. The reduction in ownership also lowers Agilent's financial obligation for minimum wafer purchases from Chartered.

Under the agreement, Agilent has the option to reacquire ownership of the 15% interest sold in Fab 6. The option covers a two-year period, beginning Oct. 23, 2002.

Fab 6 began production of 200-mm (8-inch) wafers in May 2000. The faclity has been equipped for 0.25-micron to 0.13-micron processes for SRAM- and logic-based ICs. The joint-venture fab has been equipped to process up to 35,000 eight-inch wafers per month.