Samsung Electro-Mechanics invests in package substrates

Samsung Electro-Mechanics will invest 300 billion won ($231 million) to expand production of semiconductor package substrates and widen its product range to produce substrates for servers.

Samsung Electro-Mechanics' plant in Busan [SAMSUNG ELECTRO-MECHANICS]

Samsung Electro-Mechanics will invest 300 billion won ($231 million) to expand production of semiconductor package substrates and widen its product range to produce substrates for servers.

The electric component company 23.7 percent owned by Samsung Electronics said Wednesday that the investment will be used to produce flip-chip ball grid array (FCBGA) packages at its existing plants in Busan, Sejong and Vietnam.

FCBGA refers to a sophisticated type of chip substrate designed to bind together high-performing processors and protect them from the surrounding environment.

A portion of the investment will go to producing packages for use in servers, which would be the first for a Korean manufacturer. Samsung Electro-Mechanics’ packages are primarily used for processors in PC.

The supplier is expected to mass produce the new range in the third quarter, according to local media reports.

The move follows an announcement in March of the 300-billion-won investment into the manufacturing of the FCBGA at the Busan plant. A separate investment of $850 million is planned for its Vietnamese manufacturing plant to produce the same type of substrate.

The investments, it said, is aimed at fulfilling soaring demand for processing chips, a consequence of the growing adoption of cloud computing, robots and autonomous driving. “Chip manufacturers are on the lookout for chip package suppliers as robots, cloud computing, metaverse and autonomous driving will play a critical role in the future digital landscape,” said Chang Duck-hyun, CEO of Samsung Electro-Mechanics.

“Samsung Electro-Mechanics will become a game-changer in high tech with new technologies and concepts such as System on Substrate,” he said. System on Substrate is a technique that assembles one or more chipsets on the same substrate.

BY PARK EUN-JEE [park.eunjee@joongang.co.kr]