Powerchip Semiconductor Manufacturing Corp. (PSMC): Tongluo Plant Sale to Micron to Improve Finances and Enter HBM Supply Chain
PSMC aims to achieve three key benefits by selling its Tongluo plant to Micron: improving its financial structure, entering Micron's HBM supply chain, and advancing its DRAM process technology. The US$1.36 billion payment was received in March, with the remaining US$440 million due by the end of next year. PSMC will assist Micron with HBM backend wafer manufacturing (PWF) foundry services, and Micron will integrate PSMC into its HBM advanced packaging supply chain. This move is expected to significantly reduce PSMC's bank debt and enable it to compete with Taiwanese peers.
📋 Article Processing Timeline
- 📰 Published: April 10, 2026 at 12:22
- 🔍 Collected: April 10, 2026 at 13:00 (38 min after Published)
- 🤖 AI Analyzed: April 15, 2026 at 21:22 (128h 22m after Collected)
Powerchip Semiconductor Manufacturing Corp. (PSMC) held its annual general meeting today, where Chairman Frank Huang specifically explained the sale of the Tongluo plant to Micron. He stated that Micron initially proposed only buying the plant, but PSMC considered that selling only the plant would not contribute much, so it requested that the sale be accompanied by business to achieve synergistic effects on operational improvement.
Frank Huang said that the ownership transfer of the Tongluo plant to Micron was successfully completed in mid-March, and the US$1.36 billion payment was received in March. The plant handover is proceeding as scheduled, and the remaining US$440 million balance will be fully in place by the end of next year.
Huang stated that the equipment and personnel of the Tongluo plant will be gradually transferred back to the Hsinchu plant area without layoffs or interruption of operations, and old equipment and low-margin products at the Hsinchu plant will be phased out. In addition, PSMC has begun to build and assist Micron with high-bandwidth memory (HBM) backend wafer manufacturing (PWF) foundry services, and Micron will include PSMC in its HBM advanced packaging supply chain.
Frank Huang stated that the sale of the Tongluo plant to Micron will bring three major benefits to PSMC: improving its financial structure, receiving advance payments from Micron, becoming part of Micron's HBM supply chain, and Micron will assist PSMC in refining its dynamic random-access memory (DRAM) process, allowing PSMC to quickly reach a level competitive with its Taiwanese peers.
PSMC Vice Chairman Hsieh Tsai-chu said that Taiwan imports US$25 billion worth of HBM from South Korea annually. As Micron expands its HBM production capacity in Taiwan, Taiwan's future production of AI servers will reduce its reliance on South Korea.
PSMC stated that the Tongluo plant transaction is estimated to bring in NT$56.7 billion in funds. It plans to repay NT$44 billion in bank loans this year, reducing bank loans from over NT$70 billion to NT$26.7 billion by the end of the year.
In response to the demand for HBM backend wafer manufacturing foundry services and DRAM technology advancement, PSMC indicated that it will issue common shares through a cash capital increase to participate in overseas depositary receipts, with a limit not exceeding 420 million shares. In addition, PSMC will undergo bank debt restructuring. (Editor: Lin Chia-Hsien) 1150410
Frank Huang said that the ownership transfer of the Tongluo plant to Micron was successfully completed in mid-March, and the US$1.36 billion payment was received in March. The plant handover is proceeding as scheduled, and the remaining US$440 million balance will be fully in place by the end of next year.
Huang stated that the equipment and personnel of the Tongluo plant will be gradually transferred back to the Hsinchu plant area without layoffs or interruption of operations, and old equipment and low-margin products at the Hsinchu plant will be phased out. In addition, PSMC has begun to build and assist Micron with high-bandwidth memory (HBM) backend wafer manufacturing (PWF) foundry services, and Micron will include PSMC in its HBM advanced packaging supply chain.
Frank Huang stated that the sale of the Tongluo plant to Micron will bring three major benefits to PSMC: improving its financial structure, receiving advance payments from Micron, becoming part of Micron's HBM supply chain, and Micron will assist PSMC in refining its dynamic random-access memory (DRAM) process, allowing PSMC to quickly reach a level competitive with its Taiwanese peers.
PSMC Vice Chairman Hsieh Tsai-chu said that Taiwan imports US$25 billion worth of HBM from South Korea annually. As Micron expands its HBM production capacity in Taiwan, Taiwan's future production of AI servers will reduce its reliance on South Korea.
PSMC stated that the Tongluo plant transaction is estimated to bring in NT$56.7 billion in funds. It plans to repay NT$44 billion in bank loans this year, reducing bank loans from over NT$70 billion to NT$26.7 billion by the end of the year.
In response to the demand for HBM backend wafer manufacturing foundry services and DRAM technology advancement, PSMC indicated that it will issue common shares through a cash capital increase to participate in overseas depositary receipts, with a limit not exceeding 420 million shares. In addition, PSMC will undergo bank debt restructuring. (Editor: Lin Chia-Hsien) 1150410
FAQ
What are the main objectives of PSMC selling its Tongluo plant to Micron?
The main objectives are to improve its financial structure, enter Micron's HBM supply chain, and advance its DRAM process technology.
What role will PSMC play in Micron's HBM supply chain?
PSMC will assist Micron with HBM backend wafer manufacturing (PWF) foundry services, and Micron will integrate PSMC into its HBM advanced packaging supply chain.