China's SMIC Eyes S. Korea's Dongbu HiTek | Be Korea-savvy

China’s SMIC Eyes S. Korea’s Dongbu HiTek

Dongbu HiTek is South Korea's only full-fledged chip foundry firm. (image: Dongbu HiTek)

Dongbu HiTek is South Korea’s only full-fledged chip foundry firm. (image: Dongbu HiTek)

SEOUL, Feb. 23 (Korea Bizwire)China-based Semiconductor Manufacturing International Corp. (SMIC) is seeking to buy South Korea’s only foundry chipmaker Dongbu HiTek Co., industry sources said Monday, a move that is expected to bring changes to the intensely competitive market.

“Dongbu HiTek has not held an open bidding (since December), and is seeking a private contract,” an official from the Korea Development Bank said. “The company is currently negotiating with SMIC, which expressed an interest in purchasing the chipmaker.”

The official, however, said talks with SMIC are only in the initial stage, and there have been no exchanges of opinions on details, such as price.

In December, iA Inc., a local automobile chipmaker that was picked as the preferred bidder for Dongbu HiTek, withdrew its bid because of “many external and internal” issues, delaying the sales procedure for the main-bourse listed chipmaker.

Dongbu HiTek is South Korea’s only full-fledged chip foundry firm. Foundry manufacturers refer to those that make chips for other companies and do not have a semiconductor fabrication plant.

Founded in 1997, Dongbu HiTek has focused on the semiconductor business, with its portfolio covering CMOS image sensors, power management integrated circuits and digital audio amplifier chips.

Dongbu Group, whose affiliates range from insurance and construction to steelmaking firms, has been under pressure from its creditors to improve its shaky financial status.


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