Taipei, June 14, 2010 (CENS)--Elpida Memory Inc. will team up with a Taiwan`s DRAM (dynamic random access memory) chipmaker to tap mainland China market by opening a factory there in 2012 at the earliest, according to company president and chief executive officer (CEO), Yukio Sakamoto.

According to newswires, Sakamoto said products that are going to be consumed in mainland China probably have to be made in the mainland and his company will definitely go into the mainland with a Taiwanese chipmaker. The company, he added, will seek support from the Chinese government.

It is understood that Elpida has considered ProMOS Technologies Inc. as the foremost candidate and PowerChip Semiconductor Corp. (PSC) the second candidate for its partner in this cooperation deal.

Both ProMOS and PSC have responded to the reports with low-profile attitude. ProMOS said it would take into account any form of cooperation with Elpida but it is not in a position to respond to the reports on the partnership deal. PSC said it has never talked with Elpida on the deal.

Taiwan`s industry watchers pointed out that the partnership, once realized, would highlight the first alliance enabling a Taiwanese DRAM chipmaker and a foreign company to jointly target an overseas market. Also, such a deal spells out the reality that hiking investment cost is driving memory-chip makers to form alliances to reduce costs.

Industry executives think teaming up with Taiwanese chipmakers is the most viable approach for Elpida to enter the mainland China market as people in the mainland and Taiwan share the same culture and origin.

Informed sources pointed out that Elpida would open a 200-mm wafer fab to turn out non-standard memory chips in the initial stage of its China market plan and ProMOS would be the most favorable partner candidate given its operating 200-mm fab, dubbed as ProQ, in Chongching in the mainland.

Sakamoto once commented ProMOS is one of Elpida`s most crucial partners this year.

Although PSC has obtained Taiwan government`s permission to open a 200-mm wafer fab in the mainland, the firm has not begun materializing its plan. Nevertheless, industry watchers estimate Elpida would open its factory in Xuzhou once it determines to ally with PSC on ground that PSC already opens an office in Xuzhou.

(by Ken Liu)