Toshiba, SanDisk Seal Fab Deal

Staff Reporter -- Electronic News, 7/13/2006

It's official: Following plans announced in April, SanDisk Corp. and Toshiba Corp. have sealed the deal to build a new $3 billion 300mm NAND wafer fab in Japan.

The fab will be home to the companies' newly formed joint venture, dubbed Flash Alliance Ltd., and will produce chips for both parties, according to a regulatory SEC filing made Wednesday by SanDisk.

This is not the first time the two companies have joined forces. In 2000, SanDisk and Toshiba formed FlashVision to equip a 200mm NAND wafer fab, and in 2004, the companies teamed up to form Flash Partners to equip a 300mm NAND wafer fab.

The new fab will be located in Yokkaichi, Japan, and will be named Fab 4, according to the filing. Production at Fab 4 is slated to begin at the end of 2007, with capacity at full expansion expected to be more than 100,000 wafers per month.

To date, the parties have agreed to an expansion plan to 67,500 wafers per month for which the investment is set at approximately $3 billion, the filing said, with SanDisk and Toshiba each pitching in $1.5 billion.

Under the terms, Flash Alliance will be 49.9 percent owned by SanDisk and 50.1 percent by Toshiba.