Semiconductor packaging firm Hana Micron was in talks to buy semiconductor testing company APACT.
Hana was seeking to acquire APACT to win a large, long-term order to handle semiconductor backend process work from South Korean memory giant SK Hynix, people familiar with the matter told TheElec.
Those at Hana were in talks with the management and the largest shareholder of APACT for the deal, they said.
APACT was formed back in 2007, then being called Hisem. Woo Eui-jei, previously the CEO of Hynix Semiconductor, which is now SK Hynix, was the chairman of the board of APACT at the time.
Companies such as Jusung Engineering, KCTech, Dongjin Semichem, Shinsung E&G and other SK Hynix partners were named the shareholders of APACT at the time, to the surprise of many. APACT, was in essence, a joint venture between the memory giant and its partners to foster the local ecosystem for memory chips and their packaging and testing.
In 2017, APACT’s largest shareholder became Pan Asia Semiconductor Service. It changed its name to APACT in 2020.
APACT’s sales mostly come from SK Hynix, and its long relationship with the memory maker has given it substantial expertise in testing for memory chips.
Hana Micron is currently in talks with SK Hynix for a long-term deal to handle backend process. SFA Semicon was also considered by SK Hynix for the order but was removed from its candidate list due to its ties with Samsung.
Talks between Hana and SK Hynix includes discussions of SK Hynix potentially investing in Hana, while Hana would spend up to 1 trillion won to expand its facilities to handle SK Hynix’ work, the people said.
How SK Hynix will invest in Hana is yet to be determined, the people said. SK Hynix could buy the equipment needed and hand them over to Hana. Or it could buy a direct stake in Hana. SK Hynix is planning not only to give orders for basic packaging work, but also for high bandwidth memory that uses through-silicon via technology, which means the investment will be substantial.
Hana’s plan to buy APACT was done in light of these discussions, the people said. Having APACT will allow Hana to handle all the backend work SK Hynix plans to give it.
Hana currently finished its second factory in Vietnam. It was built to handle chip backend work from Samsung; but it has received no order as of yet, leaving the facility empty.
Hana is planning to utilize the second factory for packaging and testing work from SK Hynix.
SK Hynix is currently handling its own memory packaging work at its P&T4 line at its Icheon plant. Its subsidiary in Chongqing, China handles NAND packaging work, while its joint venture with Wuxi at the same city, called Hitech, packages DRAM.
SK Hynix is seeing over 10% increase every year for DRAM production and over 30% for NAND, a person familiar with the matter said.
This means the memory giant will need a reliable partner to handle more packaging and testing work of the increased volume, they said.
Hana Micron, in a statement, said it was in talks with multiple customers on the matter to expand customers and market, but nothing was decided yet.
SK Hynix also said in a statement that there was nothing decided on the matter.