Cypress exits Texas fab
By Suzanne Deffree, Managing Editor, News -- EDN, December 19, 2007
Cypress Semiconductor Corp. today announced that it will exit its Fab 2 semiconductor manufacturing facility in Round Rock, Texas, by late 2008 and transfer production to its Minnesota fab and outside foundries.
Calling the Minnesota plant “more cost-competitive,” the San Jose-based company said it is currently looking at a number of options that include selling the Texas fab operation or divesting its assets.
"We have a long transition timeline and anticipate a smooth product manufacturing transition with no customer impact," Shahin Sharifzadeh, executive VP of manufacturing at Cypress, said in a statement. "Fab 2 is a very efficient and well-run operation but the factory is small and runs older 0.35 micron process technologies. All of our newer products are being designed on more advanced process technologies, so it is simply more cost effective for us to shift manufacturing elsewhere than to retool Fab 2."
Sharifzadeh added that there is “ample cost-competitive foundry capacity in Asia” that Cypress can tap for lower manufacturing costs.
The company opened Fab 2 in 1987 with 68 employees and 18,000-square feet of cleanroom space. The plant was expanded to 32,000-square feet in 1999 and currently employs 245 people. In recent years, the site has been building legacy USB, programmable logic, timing and communications devices on six-inch wafers. Sharifzadeh said the plant would be ideally suited for a company that is looking to make custom analog parts or wants a site for U.S.-based products.
Cypress' decision to exit Fab 2 is inline with the company's recent asset lite moves. The company in July sold a San Jose test facility to Presto Engineering Inc. In February, Cypress handed off its next-generation process development and all manufacturing at 65-nm and below for its core SRAM products to Taiwan-based foundry United Microelectronics Corp. In January, Cypress sold its Silicon Valley Technology Center foundry to two private equity firms for approximately $53 million in cash.
