Thursday, 12 July 2007

STMicro Shutters Three Plants To Save

Chip maker STMicroelectronics has said it will shut down three of its manufacturing plants-two in the US and one in Morocco over the next two to three years following the decision...

Chip maker STMicroelectronics has said it will shut down three of its manufacturing plants-two in the US and one in Morocco over the next two to three years following the decision to deconsolidate its Flash memory business.

Once the changes are complete, the company said it expects to save about USD 150 million per year in the cost of goods sold. It also expects pretax impairment and restructuring charges in the range of USD 270-300 million.

This decision will affect 4000 employees. However the company said it would transfer the employees or give them ‘transition-based incentives.’

It also said it is closing the fabs as it wants to move the manufacturing of all 6 inches wafers to new fabs in Singapore or to finer-geometry 8-inch facilities around the world.