Dongbu Electronics is expected to sign a supplier deal with Texas Instruments Inc. valued at US$300-$500 million annually.
Under the deal, the Korean chip foundry company will supply non-memory chips measuring 0.13-0.09 microns to the US chip giant.
A joint announcement is expected at the end of this month, according to creditors and officials of the Dongbu Group.
To secure the deal, Dongbu Electronics is said to have recently installed a 0.13-micron chip production line.
The deal is expected to be long term, guaranteeing a stable cash flow to the group.
Market watchers forecast that once the contract is sealed, it will give Dongbu Group the momentum to strengthen confidence in the Korean chip foundry business, threatening Taiwanese rivals such as TSMC and UMC.
Source: Maeil Business Newspaper, Korea.