AVAILABLE FOR LEASE: FLEXIBLE 300MM ADVANCED CLEANROOM
ATREG is representing the owner of an advanced 300mm manufacturing shell who would consider leasing all or a portion of their facility to a company or companies interested in resuming 300mm operations. Situated on a mature technology campus that includes other advanced technology facilities, the former semiconductor fab features a ballroom-configured cleanroom spanning 100,000 sq. ft. The entire cleanroom is available for lease, or alternatively, the facility could be leased in independently operated 25,000 sq. ft. increments.
While the facility is not currently operational, it has been maintained in a state which would allow for resumption of 300mm activities with a relatively brief period needed to reinstall certain elements of infrastructure and allow for the installation of manufacturing equipment. This facility would provide a lessor a distinct time-to-market advantage versus the construction of a new facility and, given the ability to lease in 25,000 sq. ft. increments, realistically scale operations based on current and future manufacturing needs.
For more information on this particular facility, please contact our Vice President Nick Papa by phone at +1.206.268.7804 or by email. We remain at your disposal to discuss any other advanced technology manufacturing assets your company may need to increase capacity, whether brownfield or greenfield.
TOP 4 CONSIDERATIONS WHEN DISPOSING OF AN OPERATIONAL SEMICONDUCTOR FAB
Selling an infrastructure-rich manufacturing asset such as an operational semiconductor fab can be a difficult and time-intensive process. Competing interests from multiple stakeholders as well as transaction complexities can arise and derail a successful divestment. Over the last 17 years, ATREG has facilitated many of these transactions for some of the world’s largest and most reputable technology companies. Drawing from our extensive experience, we thought we would share the top four critical elements to ensure a successful fab sale:
1. Gain corporate alignment
- Establish clear support within your company for a particular disposition strategy
It is not uncommon for various stakeholders within a company to have differing views about the disposition strategy for a fab. The real estate group may consider the sale of the site as a real estate asset, the procurement team may have discussions with their contacts regarding the sale of the tools, etc. However, if the plan is to maximize transaction value by selling the fab operationally, all stakeholders must be aligned. Operational buyers will be wary about evaluating a fab opportunity seriously if they hear rumors that the tools and/or real estate are being shopped separately.
- Assign a small, focused internal team with a high level of authority to manage the divestment project
In order to further minimize the potential for mixed messages, it is important that the selling company assigns a project team with the decision-making power to control the disposition process both internally and externally. This team would be responsible for making sure everyone within the company adheres to the agreed-upon disposition strategy, while working shoulder to shoulder with a trusted advisor to communicate a coherent message to the market.
2. Set realistic expectations
- Be educated about the market and market dynamics
At the beginning of a fab disposition process, companies should have a solid understanding of current semiconductor manufacturing dynamics and the potential impact on the demand and anticipated valuation for the fab. In general, second-hand semiconductor facilities will always sell at a fraction of their original investment. However, in a period of constrained capacity, an attractive asset typically attains higher value than usual given a shortage of fab opportunities and multiple buyers. Conversely, in a down market when excess capacity is an issue, lower fab values should be expected. If sellers are not realistic in regard to fab value and other deal considerations, a mutually beneficial transaction will be difficult to achieve. Prospective buyers don’t have the time and money for belabored discussions with unrealistic or reluctant sellers.
- Look at the transaction holistically
The price paid for a fab is just one component of the overall value of a transaction. Other elements such as the supply agreement terms (e.g. duration, volume, pricing), potential liabilities relieved in the event of a fab shutdown, and non-financial considerations such as graceful exit from the site (e.g. avoidance of mass workforce layoffs) should all be considered in calculating the overall value for the transaction.
3. Carry out a formal process
- Demonstrate that you are a committed seller and create a sense of urgency
Carrying out a formal disposition process and retaining advisors sends a clear message to the market that the company is serious about completing a transaction. Additionally, a formal process allows the company to solicit and compare multiple offers simultaneously, thereby providing sellers with pricing leverage and options with regards to deal terms (e.g. terms, counter-party, timing, etc.)
4. Leave no stone unturned
- When possible, institute a public campaign for maximum exposure
Fab offerings are typically confidential given customer and employee sensitivities. However, whenever possible, running a public marketing campaign helps increase awareness of the opportunity and typically compresses the time required to fully expose the offering to the market. The market typically responds more favorably to fab offerings from established, well-respected companies, so revealing the identity of the seller from the outset can be advantageous.
- Don’t limit the marketing effort to only a small set of logical buyers
Although it makes sense to concentrate on the most realistic set of buyers (particularly in the scenario of an operational sale), given the limited number of transactions that occur in a typical year, it is wise to contact a broader set of prospects, including IDMs, foundries, OEMs, and even fabless companies. In cases where a fab cannot be sold operationally, this is even more relevant as the cleanroom asset can potentially be utilized by a much broader set of companies and industry sectors, including data center, solar, etc.
For more information
Please call us at +1.206.268.7800 or email us to set up a complimentary phone consultation about fab divestment or acquisition with one of our team members or a face-to-face meeting at one of the many global industry conferences we will be attending this upcoming quarter.
SEE YOU AT Q4 INDUSTRY EVENTS!
Members of our team will be attending the following global industry events this coming quarter:
- Business Connection Forum, October 3-5, Albany, USA
- International Technology Partners Conference (ITPC), November 5-8, Waimea, USA
- SEMICON Europa, November 14-17, Munich, Germany
- SIA 40th Anniversary Annual Award Dinner, November 14, San Jose, USA
- GSA Annual Awards Dinner, December 7, Santa Clara, USA
- SEMICON Japan, December 13-15, Tokyo, Japan
If your company is planning the divestment or acquisition of infrastructure-rich advanced technology manufacturing assets, please email us or call us at +1.206.268.7800 to set up a meeting and discuss your specific needs. We look forward to seeing you there!