Technical Insight
Filtronic proposes tie-up for UK GaAs fab (GaAs NEWS)
Filtronic has announced that it is in discussions with a "leading international aerospace and defense OEM" to form a joint venture company based upon the infrastructure located at its 6 inch GaAs fabrication facility in Newton Aycliffe, UK. Filtronic purchased the plant in September 1999 and set about a $56 million conversion that gave the company 100 000 sq. ft of clean-room space for the production of a range of PHEMT-based products (see Compound Semiconductor May 2001, p87). The plant opened in August 2000, but by February 2001 Filtronic was reporting substantial losses arising from its GaAs operation. These losses were attributed to the cost of maintaining a very large fab with a capacity far in excess of that required for Filtronic s internal use, coupled with the long time required to establish and qualify products with customers. Filtronic stated that it was looking for a strategy to "reduce or eliminate the financial burden" of this group (see Compound Semiconductor March 2001, p30) this latest move appears to be the culmination of this strategy. Commercial and defense markets Both shareholders in the proposed joint venture will benefit from access to an advanced compound semiconductor manufacturing plant and Filtronic s automated microwave electronics subsystems factory. Key products from the facility for Filtronic include GaAs PAs for 3G base stations, customized MMICs for millimeter-wave broadband wireless products, and photonic components. It is intended that the factory will supply Filtronic with complete amplifier and transceiver subsystems for both commercial and defense markets. Products for defense markets will include devices for phased array radar and electronic countermeasure systems, in addition to products being supplied by Filtronic for various defense projects such as EuroDass and Euroradar for the Typhoon avionics system. According to Filtronic, it is intended that production at the plant will not be entirely captive and that the compound semiconductor devices will be made available to one or more selected third parties that do not compete with the principle shareholders. Overall, a significant proportion of the output for both the GaAs fab and the microwave factory will be for commercial applications. This in turn will enable the military components to be produced relatively cheaply as they will gain from the economies of scale achieved in the commercial work, a benefit not always available when producing products for the military market, where volumes are small in comparison.
