[News] SBI Chairman Accuses PSMC of Dishonesty, Calls Breakup a Blessing

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A major collaboration between Taiwan and Japan on semiconductors has been halted, as PSMC suddenly informed SBI Holdings in late September that it was unable to proceed with the plan of constructing a fab in Japan as it had promised a year ago. With various speculations circulating concerning the reason behind, SBI Holding Chairman and CEO Yoshitaka Kitao has made his stance.

By harshly criticizing PSMC on his personal Facebook account, he accused the company of dishonesty, according to a report by TechNews.

Kitao referred to the breakup as “a blessing in disguise,” for the partnership has been terminated before any damage has been done, the report notes. He even quoted the saying of Confucius, a well-known Chinese philosopher, to express his disappointment in PSMC. ‘Without trust, one cannot stand,” he said.

According to Kitao, this is the first time SBI Holdings has had to dissolve a partnership almost unilaterally, even after making significant concessions.

According to TechNews, Kitao elaborated on his Facebook by saying that he and Frank Huang, Chairman of PSMC, had met with key government officials together, as well as providing a detailed explanation to the other party regarding the conditions for receiving subsidies from the Japanese government.

However, it is “unbelievable” that the Taiwan-based foundry company went back on their previous commitments and acted with extreme dishonesty, he accused.

According to a previous report by Nikkei, PSMC informed SBI Holdings in September that it was not willing to assume the risks linked to the project. As a result, the two companies will dissolve their partnership aimed at constructing the facility in Miyagi Prefecture in northeastern Japan, which was originally expected to begin mass production by 2027.

Nikkei also notes that PSMC has been struggling with mature nodes due to the oversupply from Chinese firms, resulting in operating losses for five consecutive quarters since Q2 2023.

According to TechNews, PSMC claimed that its collaboration with SBI would follow the Fab IP model, in which the former would provide consulting for the factory establishment, personnel training, and technology transfer, charging service fees and royalties to its Japanese partner, and it has no plans to invest in or lead the operations of the new factory.

Moreover, PSMC reportedly claimed that the subsidy policy of Japan’s Ministry of Economy, Trade and Industry (METI), stipulates that recipients must guarantee continuous production at the new facility for at least 10 years.

Given SBI’s background in finance and that it is without experience in the semiconductor industry, METI required PSMC to share responsibility for this guarantee, as PSMC claimed that being a publicly listed company in Taiwan, guaranteeing the operations of a Japanese factory without holding a controlling stake would violate Taiwan’s Securities and Exchange Act, TechNews notes.

Read more

• [News] PSMC’s Frank Huang Explores Global Expansion through Fab IP, Diverging from TSMC’s Path
• [News] Taiwan’s PSMC Denies Rumors that Financial Troubles Caused the End of Partnership with Japan’s SBI

(Photo credit: PSMC)