Taiwan Semiconductor to invest $1.38 bn in ASML for developing next-gen chips

Taiwan Semiconductor Manufacturing Co (TSMC), the world's largest contract chipmaker yesterday said that it will bankroll the next-generation chip-making technology by investing €1.11 billion ($1.38 billion) in Dutch chip-equipment maker ASML Holding NV (ASML).

The move comes less than a month after Santa Clara, California-based Intel, the world's largest chip maker, agreed to invest $4.1 billion in ASML. (See: Intel to invest $4.1 bn in ASML Holdings for developing next-gen chips)

Under the TSMC-ASML deal announced yesterday, Hsinchu, Taiwan-based TSMC will acquire a 5-per cent stake in ASML for €838 million and commit to invest a further 276 million, spread over 5 years, in research and development of next-generation lithography technologies, including extreme ultraviolet (EUV) lithography technology and 450-millimeter lithography tools.

This deal is an extension of the long-term partnership between ASML and TSMC, where both companies collaborated successfully in the development of the 193-nanometer immersion lithography.

In July  ASML had unveiled a ''Customer Co-Investment Program for Innovation,'' in which the Veldhoven, Netherlands-based company invited its customers to invest in its program in order to accelerate key lithography technologies for the benefit the entire industry.

Under the investment program, ASML has offered a total of 25 per cent stake in itself to chip makers, including a 5-per cent stake to Samsung, but the South Korean electronics giant has yet to take a decision.