TowerJazz and Panasonic Corporation Signed Definitive Agreement to Create a Joint Venture

22 December, 2013

The new JV to include three Panasonic semiconductor manufacturing facilities in Japan. Panasonic will invest $40 million. TowerJazz will own 51% f the new venture

Panasonic will transfer its semiconductor wafer manufacturing process and capacity tools

TowerJazz plant at Migdal Haemeq, Isral
TowerJazz plant at Migdal Haemeq, Isral

TowerJazz  and Panasonic Corporation, have signed of a definitive agreement to create a joint venture (JV) to manufacture Panasonic’s products, using Panasonic’s three semiconductor manufacturing facilities in Japan, as well as possible expansion of the current operations in those fabs, leveraging TowerJazz’s customers and businesses to capture out-of-group sales.

Panasonic will transfer its semiconductor wafer manufacturing process and capacity tools of 8 inch and 12 inch at its Hokuriku factories (Uozu, Tonami and Arai) to the JV, commit to acquire its products from the JV for the volume production for least five years, and will transfer to TowerJazz 51% of the shares of this JV.

With aforementioned partnership, Tower Jazz and Panasonic will develop the JV to be a global leading specialty foundry. The JV is expected to increase TowerJazz’s technology offerings by providing multiple additional specialty flows.

It includes Panasonic’s technologies such as High Definition FSI – a CMOS Image Sensor technology for high quantum efficiency, low dark current and high voltage SOI (silicon-on-insulator) based power management technologies.

High Definition FSI enables the use of front side illumination (FSI) even for small pixels, where usually, an expensive backside illumination (BSI) is being widely used in the industry. High Definition FSI consists of light separation walls combined with a light pipe structure that funnels the light into the individual pixels with minimal light loss.

This technology provides high sensitivity (high quantum efficiency) to light, low sensitivity to different angles of light that helps in preventing shading at the periphery of the image and excellent color
separation leading to true and vivid colors.

The production of High Voltage SOI technology from Panasonic immediately extends TowerJazz’s BCD (Bipolar-CMOS-DMOS) offering from 80V to 190V enabling entry into new display driver, industrial and medical markets previously not accessible. The technology includes a low-Rds(on) integrated IGBT (insulated-gate bipolar transistor) to enable efficient high-voltage drivers, 5V CMOS for integration of digital and analog functions.
Amir Elstein, TowerJazz Chairman, stated, “This acquisition and the JV creation with Panasonic

As consideration for its 51% equity holding in the JV, after closing of this transaction, TowerJazz will issue to Panasonic ordinary shares in the value of approximately $8 million, to be calculated based on TowerJazz average shares value during March 2014. The JV balance sheet assets will include, among others, approximately $40 million to be invested by Panasonic.

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