China’s largest chipmaker by market value is barely a week removed from its record-breaking IPO, and it’s already lining up its next major expansion.
CXMT is reportedly in preliminary discussions to construct a second 12-inch wafer facility in the Yizhuang area of Beijing, say two people with knowledge of the matter but not authorised to speak about it.
The plant will be located some 20 kilometres southeast of downtown Beijing, where CXMT currently operates a DRAM fab plant.
What is CXMT asking for?
The company is reportedly trying to secure at least 60 million yuan ($8.9 million) of funding from the Beijing Economic-Technological Development Zone’s management committee, while other state-owned technology companies have also shown willingness to participate in the funding.
However, it is reported that the nature and size of the package are not set in stone, and it remains to be seen whether the funding will come straight from the administrative body or via the investment agencies of the development zone.
It will be the fourth expansion project for CXMT apart from existing projects in Shanghai and Hefei, which, when completed, will help the company double its capacity to over 600,000 wafers per month.
Establishing a factory that will manufacture cutting-edge DRAM memory chips will cost more than $10 billion, although the exact capacity and total investment in the new factory remain undisclosed by CXMT.
CXMT’s growth has been closely tied to the so-called “Hefei model”, where Anhui’s capital used state funding to build the company from scratch, a template Beijing and Shanghai are now competing to replicate for a larger share of the strategic and economic upside.Â
