News Article

Anadigics Blazes Trail To China With $50m GaAs Fab

The US chip maker's decision to build a GaAs wafer fab in Kunshan's high-tech industrial development zone marks the beginning of a new era in RFIC production.

Anadigics, one of the world s top suppliers of GaAs-based radio frequency ICs, has elected to build a new wafer processing facility in Kunshan, China.

The new fab will represent the first GaAs facility to be constructed in mainland China, and marks a significant moment in the evolution of the compound semiconductor industry as it follows in the footsteps of the silicon business.

Anadigics, which was also one of a handful of companies to pioneer 6 inch GaAs wafer production in the late 1990s, told that it was "blazing a trail" with its latest move.

Partnering with the Kunshan New and Hi-Tech Industrial Development Zone (KSND), Anadigics will invest $10 million-$15 million over the next two years as it works towards developing initial production runs.

The Kunshan fab should be up and running in the first half of 2009, while the New Jersey company expects its total investment in the new site to reach nearly $50 million. Ultimately, the new fab should closely mimic the existing Anadigics wafer fab in Warren, NJ.

However, like the operation in Warren, the Chinese fab will not feature any epitaxy - Anadigics currently purchases all of its production epiwafers.

Broadband sweet-spot
According to the company, it is not just the potential for low cost wafer production that has made the Chinese location an attractive proposition. China now represents one of the world s biggest and fastest-growing markets for the components that Anadigics manufactures.

Third-generation cellular services, broadband wireless connectivity and new technologies such as WiMAX are all witnessing rapid growth, particularly in "emerging" economies such as China.

Jennifer Palella, senior director of marketing at Anadigics, expects these applications to converge in a "sweet spot of broadband multimedia" between now and 2009. By the time the new Kunshan fab is up and running, this should create enough demand for a significant ramp in GaAs device production.

Palella does not expect major changes in the overall product mix that Anadigics will be required to deliver by that time, with feature-rich cellular handsets remaining the single most critical application.

She added that the lack of local people with GaAs wafer fabrication experience in China should not be a major problem for the company, suggesting that Anadigics faced a similar issue when it built its existing fab in New Jersey.

One of the solutions that Anadigics employed then was to set up a new program in cleanroom fabrication techniques at the local vocational school - before subsequently hiring the graduates of the program.

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