SK Hynix Begins to Transfer 200 Bil. Won Worth of Equipment to China

After acquiring Intel's NAND flash business in October, SK Hynix is taking steps to reinforce its foundry business in China.

SK Hynix System IC, a subsidiary of SK Hynix that specializes in the foundry business, has sold all of its semiconductor production equipment at its plant in Cheongju, North Chungcheong Province, to a joint venture in Wuxi, China.

SK Hynix is seeking to expand its business portfolio from memory semiconductors to foundry. The relocation of the production equipment is seen as a strategic move to further expand its presence in the Chinese foundry market amid the U.S.-China trade dispute.

SK Hynix System IC sold 1,206 pieces of semiconductor equipment to SK Hynix System IC’s joint venture in Wuxi, Chin, for 194.2 billion won. It accounted for 29.2 percent of SK Hynix System IC’s total assets.

The disposal of the equipment is a follow-up action to the announcement in July of the relocation of SK Hynix System IC’s M8 Plant in Cheongju to China. The company plans to move its 200-millimeter wafer foundry line in Cheongju to China to produce mid- and low-end foundry products. In Korea, it will focus on high-value-added and high-tech products, including 300 mm wafer image sensors.

SK Hynix System IC is a foundry company established by SK Hynix in 2017 to secure new growth engines away from memory semiconductors. The company established a joint venture with WIDG, an investment company of the Wuxi government in China, in 2018 and completed the construction of a foundry plant in the first quarter of 2020. Currently, the plant is in trial operation and will begin commercial operations at the end of 2020.