Atmel pledges to stay in Tyneside ‘for long term’

Semiconductors: deal seals US manufactures future in former Seimens plant

US SEMICONDUCTOR maker Atmel has pledged to stay in the UK ‘for the long term’ after taking over the former Siemens plant in North Tyneside.

An agreement between Atmel and Siemens was hailed as a major boost to the region which could create up to 1,500 jobs.

The North Tyneside facility has been mothballed since 1998, when the German electronics giant walked away after just 18 months during a global collapse in the semiconductor market.

Under the agreement, Atmel has agreed to sell $1.5bn worth of product to Siemens over the next four years, which has in turn pledged to buy the product.

The deal was aided by a &#16328m regional selective assistance grant from the government.

Atmel will install CMOS, BiCMOS and silicon germanium process technology at the plant to manufacture 0.18 micron wafers for memory and microcontroller products. These are less suscep-tible to market volatility than chips. Production is expected to begin next year. Atmel has stressed the solid commercial foundation for the deal and its commitment to the North Tyneside area.

Donald Colvin, the California-based company’s chief financial officer, said the semiconductor industry was enjoying a period of sustained growth set to continue for at least the next three years.

Colvin said much has changed since the slump in demand which caused Siemens to pull out of North Tyneside. ‘Then the industry was very dependent on the PC market. Now lots of new products are driving the semiconductor market, such as mobile phones and digital cameras,’ said Colvin.

Atmel also stressed that the future of the plant was not linked solely to the supply agreement with Siemens. ‘It will supply Atmel for distribution on a worldwide basis,’ said Colvin.

‘We had in-depth discussions with the UK government regarding the regional funding, and clearly there is a requirement for us not to be in a slash and burn situation, but to be in there for the long term.