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Magnachip Semiconductor Corporation announced that the Company is separating its display and power businesses into separate entities, following approval by its board of directors and strategic review committee.
YJ Kim, Magnachip’s chief executive officer commented, “This strategic separation represents a significant milestone for Magnachip and underscores the Company’s commitment to unlocking long-term value for our shareholders. The internal separation is aimed at enhancing transparency, accountability and flexibility in business. By establishing distinct entities, we believe our investors will be able to better evaluate the financial performance of each business and their respective contributions. Furthermore, this strategic move will allow each entity to allocate its resources, both financial and technical, more effectively to the specific needs of its customers.”
YJ Kim continued, “Magnachip remains dedicated to delivering innovative solutions and exceptional customer experiences in both the display and power sectors, and we are confident that this separation will strengthen our ability to achieve these objectives by enhancing each business’s agility and focus.”
The Company plans to effectuate the internal separation (the “Internal Split-Off”) by establishing a new subsidiary (“NewCo”) under Magnachip Semiconductor, Ltd. (“Magnachip Korea”), the Company’s operating subsidiary. As part of the transaction, all assets and liabilities of the display business will be contributed to NewCo in exchange for equity. Once the Internal Split-Off is completed, Magnachip Korea and NewCo will both be separate operating companies, with NewCo being a wholly owned subsidiary of Magnachip Korea. The Company’s Gumi fabrication facility will remain with Magnachip Korea as an integral part of its power business.
Post-separation, the board of directors of Magnachip will continue to oversee both operating entities, ensuring cohesive governance, while YJ Kim and the executive management team will manage their business and operations. Each of Magnachip Korea and NewCo will remain indirect wholly owned subsidiaries of Magnachip, and the Internal Split-Off is not expected to have any material impact on the Company’s financial reporting or consolidated financial statements.
The Internal Split-Off is expected to be completed in the fourth quarter of 2023.
Original – Magnachip Semiconductor
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Navitas Semiconductor announced the first in a series of strategic manufacturing investments, to increase control, reduce costs and enhance revenue capacity for its GeneSiC silicon carbide (SiC) power semiconductors.
An initial $20 million investment enables a three-reactor SiC epi-growth facility at the company’s Torrance, CA headquarters. Adding a SiC epitaxial (or “epi”) layer onto a raw SiC wafer is the first step in manufacturing individual SiC power devices. The first AIXTRON G10-SiC epitaxy reactor, with 6” and 8” wafer capability, is expected to be fully qualified and in production in 2024. Navitas views the epi-growth services to be provided by its new facility as a critical process step that could support up to an additional $200 million in annual production. The company expects to continue the use of third-party vendors for additional epi-growth, wafer fabrication and assembly operations.
“We are proud that an important technology innovator such as Navitas chose our new G10-SiC to further accelerate the adoption of SiC in the growing market for energy efficient power devices. This is especially significant as AIXTRON and Navitas are both firm believers and pioneers in the unstoppable advance of GaN and SiC over legacy silicon. It is through partnerships like ours, where highly innovative companies work together, that this important transition can be realized,” says Dr. Felix Grawert, CEO and President of AIXTRON SE.
“Adding a high-quality SiC epi-layer onto a raw SiC wafer is a critical process step prior to individual device manufacturing, and adding the AIXTRON in-house epi capability to existing subcontract process flows expands available capacity, lowers finished wafer cost, increases quality and reduces cycle times”, said Dan Kinzer, Navitas COO / CTO and co-founder. “The development and manufacturing business partnership with Aixtron includes ongoing technical and co-development support.”
Navitas’ investment in internal epi capacity is one of several initiatives in support of the company’s recently-announced $760M customer pipeline of estimated potential future business, based on expressed customer interest for qualified programs. While the conversion of this pipeline into orders or shipments depends on many factors in addition to possessing available capacity, the company expects its epi capacity expansion will provide a favorable return on investment under most anticipated planning scenarios.
Navitas recently completed an $80 million follow-on common stock offering and plans to use proceeds from the offering for strategic manufacturing investments, among other possible uses, including working capital and general corporate purposes.
Original – Navitas Semiconductor
