Cyberjaya, 17 May 2022 – Dagang NeXchange Berhad (“DNeX”) and Big Innovation Holdings Limited (“BIH”), a wholly-owned subsidiary of Hon Hai Precision Industry Co Ltd (“Foxconn”), plan to set up a joint venture company (“JVCo”) to build and operate a new 12-inch wafer fabrication plant (“New Fab”) in Malaysia.

Both parties have signed a Memorandum of Understanding (“MoU”) to collaborate on establishing and operating the semiconductor fabrication facility in the country.

The New Fab is expected to produce 40,000 wafers per month, encompassing the manufacturing of 28-nanometer and 40-nanometer technologies.

According to Tan Sri Syed Zainal Abidin Syed Mohamed Tahir, Group Managing Director of DNeX, the project will allow the Group and the country leap forward in terms of semiconductor technology advancement as well as offer multitude of economic spillover effects to the country, hence be in line with the Government’s national agenda.

“The New Fab will be the first 12-inch wafer fabrication plant in Malaysia initiated by a Bumiputera company. In addition, the New Fab will be operating in the 28-nanometer technology node, which is the most advanced technology node in the planar transistor technology. This technology node will have a long production life and have the widest range of applications,” he said.

He added that, “The building of the New Fab is part of the Group’s ongoing strategy to explore new opportunities in the technology field, innovate and grow as a Group and address strong global demand for semiconductors.”

Under the MoU, DNeX and BIH will work together to decide the location of the New Fab in Malaysia, financing structure of the project, and initial management structure and key personnel of the New Fab.

“The New Fab will further strengthen DNeX’s position in semiconductor foundry as well as complement the Group’s business in this segment via its existing investment in SilTerra Malaysia Sdn Bhd, in such areas as best practices and technology excellence,” said Tan Sri Syed Zainal Abidin Syed Mohamed Tahir.

“The country’s semiconductor sector plays a vital role in the global semiconductor supply chain and with the project, we hope to further enhance the sector’s capabilities and robustness. We envision that the technologies used in the New Fab to be able to elevate technological acumen and competencies of the country to a higher level,” he said.

Additionally, he said more countries are embracing the importance of semiconductors to national security, as a strong semiconductor supply chain is indispensable to their manufacturing sector especially those focusing on the electrical and electronics (“E&E”) sector.

“With E&E being a key Malaysia’s export, this leap forward in semiconductor technology space for the country is expected to promote and encourage more local players to participate in the local semiconductor supply chain,” he said.

“Moreover, the project will be able to create new employment opportunities for the country’s work force and more importantly facilitate the upskilling of the country’s semiconductor workforce in the advanced semiconductor space, which can serve as the future innovation building block for the Group and the country, with the help of our partner, Foxconn,” he added.

BIH is a wholly-owned subsidiary of Foxconn, and is the investment entity for Foxconn’s semiconductor related activities. Foxconn is the world’s largest electronics manufacturer and also a leading technology solution provider which continuously leverages its expertise in software and hardware to integrate its unique manufacturing systems with emerging technologies.