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JULY 2019    TAP TIMES          -4-

                    M&A activity (from 3)

        Few, if any, local governments today are
        going to allow semiconductor fabs too op-
        erate in their cities.  In addition, the cost
        of constructing today’s fabs and equipping
        them is in the billions of dollars.

        Heavy dues                                              German giant Infineon (above) is offering about $9 billion
        Those old stand-bys, AMD, Intel, Micron,                for Cypress Semiconductor, San Jose.
        Texas Instruments et al., have paid some                For the past two decades, if you wanted
        heavy dues to survive in an industry that               your own fab, you either bought someone
        is known for eating its young.                          else’s or bought another company.  For

                                                                example, AMD has not operated a fab for
                                                                many years, preferring to operate through
        Decades ago, Advanced Micro Devices,                    a foundry.
        Signetics and a dozen others were quick to
        gain approval from Silicon Valley govern-
        ments to site a “clean” company, employ-                AMD’s early days
        ing hundreds of workers in a once entirely              In the early days, 50 years ago this month
        agricultural region.                                    for AMD, when Jerry Sanders founded the
                                                                company in Sunnyvale, Calif., wafer fabs
        No smoke stacks billowing thick, black                  were an integral part of its manufacturing
        debris out the chimneys, they were prom-                portfolio.
        ised.  What better way to add needed dol-
        lars to a city’s shrinking tax base.                    Today AMD has none, preferring in-
                                                                stead to leverage its resources on
                                                                chip design after selling the majority
        Toxic chemicals                                         interest in its fabs in 2008 to GLOBAL-
        After a few years, we learned that semi-                FOUNDRIES, owned by investors in the
        conductor manufacturing, due to the                     United Arab Emirates. (GLOBALFOUND-
        harsh, often toxic chemicals involved, is               RIES just sold these fabs in New York
        not as harmless as we once thought.                     state to ON Semiconductor).

        Clean, yes; no filthy smokestacks, but the
        runoff from the baker’s dozen of acids  and             Still a few good fabs
        other chemicals used in the fabs did, un-               But there are still a few good
        fortunately, leach into the existing ground-            fabs left.  Among them are
        water in the once fertile soils.                        the plants owned by Cypress

                                                                Semiconductor of San Jose.
        To this day, Most of the early chip mak-
        ers pay millions of dollars a year to clean             The company was founded
        well water on government Superfund sites.               in 1982 principally by Dr. T.J.
        The Superfund includes all of the U.S., not             Rogers (right), a brilliant Stanford grad,
        just the Silicon Valley area.                                                                 Next page
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