March 28, 2013 / 8:25 AM / 4 years ago

Taiwan's ProMOS agrees to sell 12-inch fab to GlobalFoundries

2 Min Read

TAIPEI, March 28 (Reuters) - Taiwanese chipmaker ProMOS Technologies Inc said on Thursday that it has agreed to sell its 12-inch wafer fab to Silicon Valley-based contract chipmaker GlobalFoundries, after failing to dispose of the asset in two previous auctions.

ProMos, whose shares were delisted due to its heavy debt burden, has not been able to find a buyer for the facility since 2011 to repay loans to banks including Taiwan Cooperative Financial Holding Co Ltd, Chinatrust Financial Holding Co Ltd and state-owned Bank of Taiwan.

A banking source told Reuters earlier that ProMOS had hoped to sell the facility for T$20 billion ($669.42 million).

A company spokesman at ProMOS declined to give details on the value of the deal.

ProMOS's problems reflect the state of the global dynamic random access memory (DRAM) industry, which is struggling to keep afloat amid falling prices, stiff competition and higher costs of investing in new technology.

Japan's last DRAM chipmaker Elpida Memory Inc agreed to be bought by U.S. rival Micron Technology Inc last July.

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