In its latest statement on the venture loss-making Infineon gave the projected cost of the giant fab over the next three years as Euro 2.2 billion (about $2.2 billion) but did not say where the additional Euro 1.1 billion (about $1.1 billion) to build the fab will come from. Nor was a name given for the joint venture but Infineon said it could start operation as soon as December 2, 2002, if it receives necessary anti-trust approval. Its 300-mm wafer fab is planned to be one of the world's largest with a 50,000 wafers per month capacity when fully facilitized, Infineon said.

The two companies have also agreed to develop together process technology down to the 70-nanometer process node.

The moves are part of a co-operation deal for which the companies signed contracts concerning strategic co-operation on DRAMs, Infineon said today (November 13, 2002), but which had been coming through most of 2003 (see May 2 story).

The move is in-line with Infineon's strategy of partnering with Taiwanese companies aspiring to get into the DRAM business so that it can share its costs of production and particularly of fab building. But it leaves in doubt the future of Infineon's similar ProMOS joint-venture with Mosel Vitelic, which was put in jeopardy recently (see October 4 story).

Now Infineon has aligned itself strongly with Nanya and the two companies are to develop 90-nm and 70-nm DRAM production technologies for 300-mm wafers together, and create a 50:50 joint venture for the production of DRAM chips in a new joint 300-mm facility in Taiwan. Initial production of the first 300-mm wafers in the new facility is expected in late 2003, Infineon said.

Infineon said the new 300-mm semiconductor wafer fab would be constructed in two stages. The first stage, which is scheduled for completion in the second half of 2004, will give the facility an initial monthly capacity of around 20,000 wafer starts. Completion of the second stage, currently anticipated for mid-2006, will increase capacity to around 50,000 wafer starts a month, making the facility one of the world's largest.

The total investment planned in the next three years amounts to around Euro 2.2 billion (about $2.22 billion). Infineon and Nanya will each invest Euro 550 million (about $555 million) in the project until 2005, most of which will be spent in 2004 and 2005 to ramp up production, Infineon disclosed.

"This cost-efficient way of boosting production capacities will also help us capture new business and drive our share of the global DRAM market up beyond the 20 percent mark," said Ulrich Schumacher, president and chief executive officer of Infineon Technologies, said in a statement.

"We believe that this additional capacity will move Nanya to the number four ranking of DRAM makers with double digit market share," observed Jih Lien, president of Nanya Technologies, in the same statement.

The production technology will be developed by Infineon and Nanya engineers at Infineon's Dresden site and will thereafter be used in both companies and by the new joint venture, Infineon said. Further collaboration on the development of 90-nm and 70-nm reference products in Munich is also planned.