STMicroelectronics, Sanan Optoelectronics to Form $3.2 Billion China Joint Venture

   By Adria Calatayud 
 

STMicroelectronics and Sanan Optoelectronics said Wednesday that they are forming a semiconductor-manufacturing joint venture in China, with $3.2 billion in total build-out funding.

The European and Chinese semiconductor companies said they have signed an agreement to create a silicon-carbide-device manufacturing project in Chongqing, China, to tap into rising demand for semiconductors for car electrification as well as for industrial power and energy applications in the country. Production is expected to start in the fourth quarter of 2025, with full build-out anticipated in 2028, the companies said.

The expected $3.2 billion for the full build-out of the joint venture includes capital expenditures of about $2.4 billion over the next five years, which will be funded by contributions from STMicroelectronics and Sanan Optoelectronics, support from the local government and loans, the companies said.

Sanan will separately build a silicon-carbide-substrate manufacturing plant to fulfill the needs of the joint project, the companies said.

Completion of the project remains subject to regulatory approvals, STMicroelectronics and Sanan said.

Write to Adria Calatayud at adria.calatayud@dowjones.com

(END) Dow Jones Newswires

June 07, 2023 03:11 ET (07:11 GMT)

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