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RFMD Halts Diggers On Greensboro Expansion

The GaAs chip maker says its $25 million acquisition of Filtronic Compound Semiconductors will delay the need for a $200 million capital investment.

RF Micro Devices has changed its manufacturing growth strategy in the wake of its Filtronic purchase, shelving its US plans in favor of the UK.

“Filtronic gives us instant capacity, rather than waiting until we get the factory built and people trained in Greensboro," said Jerry Neal, RFMD's executive vice president of marketing and strategic development.

Neal told that after the March 3 completion of the deal, development of the previously announced $103 million US processing fab is now postponed until an unspecified date.

“We have a huge amount of additional unused space at Filtronic so we have the option of expanding there before we would start back at the Greensboro facility," he said.

The experience that the 300 new employees acquired by RFMD have gained in point-to-point and military communications will also help bring forward the company's technology agenda.

“The advanced processes that we re talking about are not going to be delayed or stopped, they re going to be accelerated," Neal said. "The process development group there will be working very closely with our group in Greensboro."

“This development group will complement what we bought at Sirenza and we think that's going to help us further diversify the company into high-performance GaAs applications."

Construction in Greensboro will now either continue very slowly or stop altogether and hence RFMD s current equipment needs will drop considerably also, until building is restarted in earnest.

The original estimate for equipment required was up to $100 million, but Neal says that any purchases at the former Filtronic Newton Aycliffe facility will be minor compared to this.

He also says that the purchase has also immediately cut the cost of the PHEMT switches used by RFMD, and all for just a £12.5 million ($24.9 million) price tag.

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