SK Hynix was in talks with equipment maker YEST to procure high-pressure hydrogen annealing equipment, TheElec has learned.
The pair were in the alpha test phase of their collaboration, sources said. If the equipment passes it will enter the beta test phase, the final stages before supply, they said.
YEST to was aiming to supply the kit by the end of the year at the earliest.
Annealing equipment is used to improve the characteristics of the interface of semiconductor devices that use high-k insulating layers.
High-k materials are prone to interface defects that cause the driver current to become slower.
This must be solved for the electric characteristics of the device to become normal.
The annealing equipment uses pressure to induce a chemical reaction from the hydrogen, disabling the interface defect electrically to improve the speed of the drive current and device.
The kit is mostly used in advanced logic foundry processes and is used more and more in memory processes as well.
HPSP is the world’s first developer of equipment and has an effective monopoly. The company last year recorded 159.3 billion won in revenue and 85.1 billion won in operating profit, an increase of 73% and 88%, respectively, from last year. The company also enjoyed an operating margin rate of 53% last year.
Any advanced chipmakers that which to apply annealing must buy the equipment from HPSP. Its high growth comes from increased spending on logic and foundry by chipmakers.
If YEST wins SK Hynix as a customer, it will become the secondary vendor for the highly sought-after equipment.
However, the company also faces challenges in terms of technology and potential patent lawsuits.
Annealing equipment must maintain 100% consistency for the hydrogen at 450 Celsius, a low temperature for a chip production process. At the same time, it must improve the defect structure and 20 pressure. This takes sophisticated technology and experience.
Failing to work at the temperature will crush the metal gate and circuit patterns. The equipment must also work under high pressure. HPSP also has 30 patents related to its annealing equipment and YEST must work around all of them.
SK Hynix was verifying whether patents of HPSP will be an issue, sources said, while Samsung, another potential customer, was also interested in the matter.
Meanwhile, YEST is seeing revenue from display lamination and autoclave equipment plummet due to low spending in the display sector.
Last year, it recorded 14.4 billion won in operating loss, steeper than the prior year’s 11.1 billion won. YEST CEO Jang Dong-bok bought the company’s share last year to spur confidence in YEST’s future despite the slowdown in growth.