There is no sign of South Korean-based Simmtech Holdings (Simmtech) holding back on building its first large-scale factory in Southeast Asia despite the ongoing pandemic.
Simmtech, one of the world’s largest players in the printed circuit board (PCB) and packaging substrate for the semiconductor industry, claimed that the construction of its new facility at the Batu Kawang Industrial Park, Penang, Malaysia was right on track and scheduled for completion in 1Q22.
Phase 1 of the project costs approximately US$120 million (RM508 million) including land acquisition, construction of a factory, and the purchase of equipment.
This 18-acre plant will be manufacturing the region’s first packaging substrates for dynamic random-access memory DRAM/NAND memory chips and high-density interconnect (HDI) PCB for memory module/solid-state drive (SSD) devices.
With the support from Malaysia’s Federal government agencies, more particularly, Malaysian Investment Development Authority (MIDA) and the state government agencies, the greenfield project is progressing rapidly to ramp up capacity to Simmtech’s major customers in the region, said Simmtech Southeast Asia managing director Jeffery Chun to New Strait Times.
Simmtech is confident that the operation will begin in 2Q22. Once in full swing, the production capacity of the Penang plant will contribute an additional 20% to the company’s current combined capacity in countries such as South Korea, China, as well as Japan.
The new facility is expected to create 1,200 high-value jobs in engineering, manufacturing, and quality management by the first half of 2023.
The chosen state, Penang
Based on the company’s past experiences in China and Japan, Simmtech worked with local partners and developed a local supply chain for better operational efficiency. Penang is especially well-developed in the area of automation and Simmtech embraces automation in its manufacturing lines.
Although it is small in size, Penang, however, is large in automation technology and performance. Simmtech is looking forward to engaging the local suppliers and adding value to the company’s processes with more efficient equipment and automation solutions.
Penang houses a number of PCB manufacturing players, namely Ibiden and ELNA PCB, home-grown companies, for example, Main Market-listed GUH Holdings Bhd and QDOS Flexcircuits Sdn Bhd. According to Chun, currently, there is no large-scale PCB factory and packaging substrate manufacturing facility in Malaysia. In other words, Simmtech complements the island’s semiconductor supply chain. Below is a list of Penang’s semiconductor supply chain:
|
Members of the semiconductor supply chain in Penang |
|
Company |
|
ASE Electronics |
|
Broadcom |
|
Infineon |
|
Intel |
|
Micron |
|
Renesas Electronics |
|
TF AMD |
|
Western Digital |
Source: The Edge Malaysia
The Penang plant is not the only Simmtech’s investment in Malaysia. The company expanded its business to Malaysia in 2017 by acquiring T E Tech (M) Sdn Bhd (T E Tech), a final inspection house in Rawang, Selangor. To date, T E Tech has supported all products coming from Simmtech’s factories in South Korea, China, and Japan. Precisely, the Rawang site covers the final inspection of Simmtech products.
