Philips Seals Semiconductor JV for Jilin
Philips Electronics has signed a deal with Jilin Sino-Microelectronics
to set up a semiconductor joint venture to make chips
for the parent companies. The new company, Philips Jilin
Semiconductor Co., will design and manufacture products
for sale by the parent companies to international and
domestic consumer electronics, home appliances, lighting,
power supplies and industrial markets.
Jilin Sino-Microelectronics, the Chinese partner, is
a Shanghai-listed firm, and is one of China's leading
power transistor manufacturers, making semiconductors
for makers of televisions, telecommunications equipment,
computer hardware and automation machinery. Philips is
Europe's largest consumer electronics group, and its third
biggest semiconductor manufacturer.
Philips Electronics has ambitious plans to expand in
China through direct investment and out-source manufacturing.
It aims to double sales to US$6.7 billion in three to
five years.
Jilin is one of China's three northeastern provinces,
formerly called Manchuria. It borders on North Korea.
Traditionally, it has been home to China's heavy industrial
capability.
As China reformed, and changed from a socialist to a
market economy, the northeastern provinces have suffered
from high unemployment and limited investment. Many large
state-owned enterprises, unable to sell their products
in a market economy, have closed their doors. In the case
of electronics manufacturer, most newer factories have
been built in the Shanghai-Nanjing-Hangzhou region. This
project would be a significant hi-tech investment win
for this region.
Philips Electronics, based in the Netherlands, has had
extensive Asia exposure. It made its first factory investment
in Taiwan in 1966, and was a major player in the island's
economic development. In 1987, along with the Taiwan government,
it was one of the major investors in Taiwan Semiconductor
Manufacturing Co.(TSMC), which is now the world's largest
chip fab, and has annual revenues of US$4.7 billion.
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