As the market demand for AI chips keeps booming, two South Korean AI chip companies, Sapeon and Rebellions, are pursuing a merger to enhance their competitiveness. According to a report by the Korea Economic Daily, if everything proceeds as planned, the merger will result in the formation of Korea’s first semiconductor unicorn, with the new company’s corporate value amounting to 2 trillion won (USD 1.5 billion).

According to a report by Korean media outlet TheElec, the merger will be finalized within this year, following the signing of the deal in the third quarter.

TheElec stated that Sapeon Inc, headquartered in the US and the sole owner of Sapeon Korea, will be the largest shareholder of the merged entity. Post-merger, Sapeon Inc is expected to hold about 30% of the shares, with Rebellions’ CEO, Sunghyun Park, leading the new company.

Based on the reports, the alliance has been formed in order to win in the global AI chip market, while the two companies identify the next two to three years as a crucial window of opportunity.

Sources cited by TheElec indicated that Sapeon Korea is valued at 500 billion won, while Rebellion is valued at 880 billion won. Regarding details of the merger, during its Series A funding round, Sapeon issued convertible bonds to its investors instead of equity. Afterwards, these investors will receive shares in the merged entity.

It is worth noting that both Sapeon and Rebellion have been backed up by tech heavyweights. According to The Elec, South Korean telco SK Telecom, as Sapeon Inc’s largest shareholder, holds 62.5% of the company. On the other hand, memory giant SK hynix owns 25%, while SK Square holds 12.5%.

Meanwhile, according to the Korea Economic Daily, Rebellions is part of the telecom giant KT Corp.-led Korean “AI full stack” service providers, offering AI infrastructure including AI chips, cloud computing, and various applications.

The report by TheElec, citing industry sources, noted that since SK Group will be the majority shareholder of the merged entity, it may prefer TSMC over Samsung Foundry, given that SK hynix and Samsung are rivals in memory chips. For now, Sapeon uses TSMC as its foundry, whereas Rebellions collaborates with Samsung Foundry.

(Photo credit: Rebellions)

Recently, global chip giant Intel announced to acquire a stake in Dongguan Luxshare Technology Co., Ltd. (Referred to as “Dongguan Luxshare Technology”), a subsidiary of Luxshare Precision.

According to a report from WeChat account DRAMeXchange citing sources, it has shown that on June 12, Dongguan Luxshare Technology’s registered capital increased from around CNY 571 million to around CNY 589 million, an increase of about 3.1%, with Intel (China) Co., Ltd. as a new shareholder. It is reported that Intel China has invested CNY 17.662 million in the company.

Luxshare Precision primarily provides products for industries including consumer electronics, communications and data centers, automotive electronics, and medical sectors. As its subsidiary, Dongguan Luxshare Technology specializes in the production of communications equipment such as base station antennas, filters, and RRU, as well as interconnect products like connectors, cables, optical modules, and AOC, which have been widely used in applications like wireless communication base stations, data centers, servers, switches, and routers.

As a global leader in the semiconductor industry and computing innovation, Intel achieved a revenue of USD 63 billion in 2022. In the computing sector, statistics showed that in 4Q23, Intel shipped as many as 50 million PC processors, representing a year-on-year increase of 3% and a market share of 78%.

In the semiconductor field, Intel is developing foundry business at full throttle. According to its official website, to meet the growing global semiconductor demand and promote its IDM 2.0 strategy, Intel is ramping up its production capacity by investing about USD 20 billion in building fabs in Arizona and New Mexico, and over USD 20 billion in Ohio for the acquisition of Tower Semiconductor. It plans to pour up to EUR 80 billion to the EU in the entire semiconductor value chain over the next decade.

As per another report from the Securities Times, a source revealed that this cooperation does not involve the consumer electronics field but mainly the communications field. That means future products of Luxshare Precision in this field will be deeply integrated with Intel chips. For instance, both parties will engage in deep collaboration from the product development stage.

Furthermore, industry sources cited by the same report further explained that the transmission rate and bandwidth of communication-related products are fundamentally related to the chips they use. Therefore, Intel’s investment in Luxshare Precision’s subsidiary will enhance the competitiveness of Luxshare Precision’s products in the communications and data center sectors, contributing to the rapid development of this business.

As stated in Luxshare Precision’s annual report, the communications industry embraced new development opportunities amidst the wave of global digital transformation in 2023. Copper connectivity, optical connectivity, thermal modules, servers, and communication RF fields that Luxshare’s business has involved also saw significant growth, which became important drivers for the industry development.

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(Photo credit: Intel)

Novatek, a major driver IC manufacturer in Taiwan, has made a significant breakthrough by securing a spot in the iPhone supply chain. According to a report from Economic Daily News, Novatek’s OLED driver IC is reportedly set to be used in Apple’s upcoming iPhone 16 series, which would be the first time a Taiwanese IC design company has secured a key chip order for the iPhone. Reportedly, the order is expected to boost NovaTek’s OLED driver IC shipments in the second half of the year by 50% compared to the first half.

As the new iPhone 16 series will debut in September, reports indicate that the model will feature the latest A18 processor, produced using TSMC’s N3P process, with mass shipments expected in the third quarter.

The iPhone 16 series will continue to equip OLED panels, but with expected pixel upgrades, which will also enhance the specifications of the OLED driver IC. Novatek will supply the OLED driver IC for the new iPhone, marking its first entry into the iPhone supply chain and the first time a Taiwanese IC design company has secured a key chip order for the iPhone, the report noted.

Novatek typically does not comment on orders or customers.

Previously, Novatek’s driver ICs have been adopted by Apple’s iPad for several years, but unable to secure an iPhone order. This breakthrough comes as Novatek penetrates the iPhone 16 supply chain via the collaboration with LG Display (LGD) of South Korea, combining with LGD’s OLED panels for shipment.

According to the industry sources cited by the same report, Novatek will begin delivering the OLED driver ICs to LGD in July. These ICs will be assembled into panel modules in the third quarter and then sent to OEMs for new device production, aligning with the AI iPhone launch.

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(Photo credit: Novatek)

Samsung Electronics’ management has made a significant decision to invest in graphics processing units (GPUs). According to a report from Business Korea reported on June 18th, while the details of Samsung’s GPU investment have not been disclosed, this decision is noteworthy as it differs from their usual focus on memory and foundry services.

Per Business Korea citing Samsung Electronics’ governance report, the management committee approved the “GPU Investment Proposal” in March. The committee includes senior executives such as Han Jong-Hee, head of the Device eXperience (DX) division, as well as the presidents of the Mobile Experience (MX) and Memory Business divisions. Reportedly, this marks the first time since the agenda items were made public in 2012 that Samsung has decided to invest in GPUs, sparking speculation that the company aims to enhance its competitiveness in the GPU sector.

Industry sources cited in the same report interpret this investment as an internal strategy for Samsung to leverage GPUs to innovate semiconductor processes, rather than to develop or manufacture GPUs. At the “GTC Conference” held in March 2024, Samsung announced its collaboration with NVIDIA to develop AI-based digital twins, aiming to achieve full automation of semiconductor plants by 2030.

Reportedly, Samsung’s newly constructed high-performance computing (HPC) center in Hwaseong was completed in April 2024. This center houses a vast array of servers and network equipment necessary for semiconductor design, indicating a significant investment in GPUs.

According to the report, Samsung’s newly constructed high-performance computing (HPC) center in Hwaseong was completed in April 2024. This center houses a vast array of servers and network equipment necessary for semiconductor design, indicating a significant investment in GPUs.

Per another report from Bloomberg on June 4th, NVIDIA CEO Jensen Huang, during a briefing at the COMPUTEX, told reporters that NVIDIA is evaluating HBM provided by both Samsung and Micron Technology. Huang mentioned that there is still some engineering work needed to be completed, expressing the desire for it to have been finished already.

As per Huang, though Samsung hasn’t failed any qualification tests, its HBM product required additional engineering work. When asked about Reuter’s previous report concerning overheating and power consumption issues with Samsung’s HBM, Huang simply remarked, “there’s no story there.”

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(Photo credit: Samsung)

According to a report from Commercial Times, the construction at TSMC’s advanced packaging plant (P1) in the Chia-Yi Science Park has been halted due to the discovery of suspected historical artifacts. In response, TSMC has promptly initiated preparations for its second plant (P2). TSMC stated that they will comply with regulations from the relevant authorities regarding the suspected archaeological site found on the Chia-Yi facility grounds.

The total developed area of the Chia-Yi Science Park is approximately 88 hectares, with TSMC’s two advanced packaging plants occupying 20 hectares. This is nearly 40% larger than the 14.3 hectares of the Zhunan packaging and testing plant. The planned area for the P1 plant is about 12 hectares, initially slated for completion by the end of 2026 and mass production by 2028. The discovery of the archaeological site has led to the early initiation of the P2 plant, raising concerns about potential impacts on the advanced packaging capacity plans.

The Southern Taiwan Science Park Administration and the Cultural and Tourism Bureau of Chiayi County both stated on June 17 that, in accordance with the Cultural Heritage Preservation Act, they submitted the case to the Chiayi County Cultural and Tourism Bureau for cultural heritage review on June 7. The review committee has principally agreed to proceed with the rescue excavation, which will be carried out in accordance with relevant regulations.

The Chia-Yi Science Park is a key hub for developing the Great Southern Technology Corridor. Besides providing backend CoWoS (Chip-on-Wafer-on-Substrate) packaging for TSMC’s 2nm process from its Kaohsiung plant, the Chia-Yi facility will further integrate advanced 3D packaging technology, SoIC (System-on-Integrated-Chips), highlighting its strategic importance.

As AI chips continue to evolve, the competition in advanced packaging remains fierce, with many clients eagerly anticipating developments.

TSMC’s advanced packaging capacity is scarce, with primary customer NVIDIA having the highest demand, occupying about half of the capacity, followed closely by AMD. Broadcom, Amazon, and Marvell have also expressed strong interest in using advanced packaging processes.

Per a report from global media outlet Wccftech, NVIDIA’s Rubin GPU is expected to adopt a 4x reticle design and utilize TSMC’s CoWoS-L packaging technology, along with the N3 process. Moreover, NVIDIA will use next-generation HBM4 DRAM to power its Rubin GPU.

Industry sources cited in Commercial Time’s report have indicated that by the end of next year, TSMC’s monthly CoWoS capacity will be increased to 60,000 wafers. With growing orders and a steep learning curve, the annual capacity is expected to surpass 600,000 wafers next year. As the semiconductor industry advances into the Angstrom Era, the gap in TSMC’s advanced packaging capacity will gradually widen. Whether the Chia-Yi plant can be completed by 2026 remains a critical focal point.

Read more

• [News] NVIDIA CEO Jensen Huang Announces the Latest Rubin Architecture – Rubin Ultra GPU to Feature 12 HBM4
• [News] AMD Unveils MI325X, Claiming 30% Faster Computing Power than NVIDIA’s H200

(Photo credit: TSMC)