ASE Spends NT$14.85 Billion to Acquire Innolux's Tainan Fab 5 to Expand AI Advanced Packaging Capacity
ASE Semiconductor acquires Innolux's Fab 5 in Tainan for NT$14.85B to boost advanced packaging capacity for AI chips. TSMC is also expanding nearby.
📋 Article Processing Timeline
- 📰 Published: April 15, 2026 at 19:35
- 🔍 Collected: April 15, 2026 at 20:01 (25 min after Published)
- 🤖 AI Analyzed: April 19, 2026 at 07:59 (83h 57m after Collected)
Central News Agency (CNA)
(CNA Reporter Chung Jung-feng, Taipei, 15th) Major semiconductor assembly and test company ASE Technology Holding announced this evening on behalf of its subsidiary ASE Semiconductor that it is spending NT$14.85 billion to acquire Innolux's Fab 5 and related ancillary facilities in Tainan Science Park (STSP). ASE Semiconductor stated that the main purpose is to expand its semiconductor advanced packaging capacity.
ASE explained that to accelerate the handover schedule, the two parties will sign a separate early factory use compensation agreement. Innolux will dismantle, relocate, and clear the process equipment and specific facility equipment ahead of schedule, according to the agreed conditions. ASE will compensate Innolux for the estimated removal costs of roughly NT$982 million.
ASE Semiconductor explained that the transaction involves acquiring a total building area of 184,313.95 square meters, equivalent to approximately 55,754.97 ping.
The market expects that ASE Semiconductor's massive investment to acquire Innolux's Fab 5 is primarily aimed at expanding the advanced packaging capacity needed for artificial intelligence (AI) chips.
STSP has become a major hub for Taiwan's advanced semiconductor manufacturing. Foundry leader TSMC announced in early March this year its plan to build a fab in the development Block A of the Tainan Science Park specific area. Construction is slated to start this year and finish in 2028, introducing about 1,400 employees in the future.
Analysts note that TSMC plans to expand its 3nm and 5nm advanced processes at its Fab 18 in STSP, and will further expand 2nm or A16 advanced processes in the coming years.
TSMC purchased an Innolux fab in STSP in mid-August 2024, and media previously reported TSMC's intention to expand an advanced packaging plant in STSP. The market evaluates that TSMC is planning Advanced Backend Fab 8 locally, including CoWoS and some InFO advanced packaging production lines, making the Tainan site a crucial integrated advanced semiconductor manufacturing base for TSMC.
ASE Semiconductor is actively expanding its advanced packaging and testing sites in Taiwan this year, having held a groundbreaking ceremony for a new factory in Kaohsiung's Renwu Industrial Park on April 10. ASE stated there is room for upward revision of the holding company's capital expenditure this year. ASE Semiconductor will have six factories breaking ground this year—a new record for the company—mainly to meet the high demand from AI semiconductors and the high-tech IT industry.
ASE Technology Holding indicated in its February earnings call that it will invest an additional $1.5 billion in machinery and equipment this year, with two-thirds allocated to advanced process services. The market expects ASE's equipment capital expenditure to grow from $3.4 billion in 2025 to $4.9 billion this year. If plant, facility, and automation Capex remain at last year's $2.1 billion level, the company's total Capex this year will hit a record high of $7.0 billion. (Editor: Yang Kai-hsiang) 1150415
Choose to stand with the facts, every sponsorship from you is the power to protect press freedom.
Download the CNA "First-hand News" APP to instantly grasp the latest news.
The text, images, and audio/video on this website may not be reproduced, broadcast, transmitted, or used without authorization.
(CNA Reporter Chung Jung-feng, Taipei, 15th) Major semiconductor assembly and test company ASE Technology Holding announced this evening on behalf of its subsidiary ASE Semiconductor that it is spending NT$14.85 billion to acquire Innolux's Fab 5 and related ancillary facilities in Tainan Science Park (STSP). ASE Semiconductor stated that the main purpose is to expand its semiconductor advanced packaging capacity.
ASE explained that to accelerate the handover schedule, the two parties will sign a separate early factory use compensation agreement. Innolux will dismantle, relocate, and clear the process equipment and specific facility equipment ahead of schedule, according to the agreed conditions. ASE will compensate Innolux for the estimated removal costs of roughly NT$982 million.
ASE Semiconductor explained that the transaction involves acquiring a total building area of 184,313.95 square meters, equivalent to approximately 55,754.97 ping.
The market expects that ASE Semiconductor's massive investment to acquire Innolux's Fab 5 is primarily aimed at expanding the advanced packaging capacity needed for artificial intelligence (AI) chips.
STSP has become a major hub for Taiwan's advanced semiconductor manufacturing. Foundry leader TSMC announced in early March this year its plan to build a fab in the development Block A of the Tainan Science Park specific area. Construction is slated to start this year and finish in 2028, introducing about 1,400 employees in the future.
Analysts note that TSMC plans to expand its 3nm and 5nm advanced processes at its Fab 18 in STSP, and will further expand 2nm or A16 advanced processes in the coming years.
TSMC purchased an Innolux fab in STSP in mid-August 2024, and media previously reported TSMC's intention to expand an advanced packaging plant in STSP. The market evaluates that TSMC is planning Advanced Backend Fab 8 locally, including CoWoS and some InFO advanced packaging production lines, making the Tainan site a crucial integrated advanced semiconductor manufacturing base for TSMC.
ASE Semiconductor is actively expanding its advanced packaging and testing sites in Taiwan this year, having held a groundbreaking ceremony for a new factory in Kaohsiung's Renwu Industrial Park on April 10. ASE stated there is room for upward revision of the holding company's capital expenditure this year. ASE Semiconductor will have six factories breaking ground this year—a new record for the company—mainly to meet the high demand from AI semiconductors and the high-tech IT industry.
ASE Technology Holding indicated in its February earnings call that it will invest an additional $1.5 billion in machinery and equipment this year, with two-thirds allocated to advanced process services. The market expects ASE's equipment capital expenditure to grow from $3.4 billion in 2025 to $4.9 billion this year. If plant, facility, and automation Capex remain at last year's $2.1 billion level, the company's total Capex this year will hit a record high of $7.0 billion. (Editor: Yang Kai-hsiang) 1150415
Choose to stand with the facts, every sponsorship from you is the power to protect press freedom.
Download the CNA "First-hand News" APP to instantly grasp the latest news.
The text, images, and audio/video on this website may not be reproduced, broadcast, transmitted, or used without authorization.