Samsung to raise chip capex, build new line-paper

SEOUL Thu Jan 21, 2010 7:32pm EST

Related Topics

SEOUL Jan 22 (Reuters) - Samsung Electronics Co Ltd (005930.KS), the world's biggest memory chip maker, will likely increase this year's investment for memory chips and build a new production line, a local news service reported on Friday.

MoneyToday, citing unnamed industry sources, said that Samsung was expected to set this year's capital expenditure for the semiconductor business at about 7 trillion won ($6.1 billion).

Samsung had said in October this year it planned to spend more than 5.5 trillion won in memory chips, which consumes most of its annual semiconductor business capex.

MoneyToday also said Samsung is planning a new chip production line in its domestic plant, marking the first time in years that it would add a line.

A Samsung spokesman declined to comment on 2010 investment plans and said no decision has been made on a possible new production line. Samsung is expected to give more details on its capex plans when it announces quarterly earnings on Jan. 29.

The memory chip industry, recovering fast from a lengthy downturn, has seen drastic investment cuts in the past year and growth in supply is expected to be limited despite rising demand.

Even this year, memory chip makers, including No. 2 player Hynix Semiconductor Inc (000660.KS), are set to spend most of their budget in upgrading facilities, mostly migrating to finer circuitry rather than building new lines. ($1=1143.0 Won) (Reporting by Rhee So-eui; Editing by Ken Wills)

FILED UNDER: