South Korean Simmtech’s first large scale Southeast Asia PCB plant in Penang nears completion

  • Absolutely critical Penang project goes full swing to manage the supply chain
  • US$121.7 mil investment to benefit local firms, opportunities in global value chain

Artist impression of the plant in Batu Kawan Industrial Zone, Penang.

Simmtech, a South Korean- based global leading manufacturer for Printed Circuit Board (PCB) and packaging substrate for semiconductors, is currently constructing its first large scale PCB factory in Southeast Asia at an 18-acre site at Batu Kawan Industrial Park, Penang, Malaysia. The factory will join existing PCB sites operating in South Korea, Japan and China.

Despite the challenges due to the onset of Covid-19, the facility’s construction is right on track and scheduled for completion in the first quarter of 2022.

The factory will be manufacturing the region’s first packaging substrates for dynamic random-access memory (DRAM) / NAND memory chips and High-Density Interconnect (HDI) PCB for memory module / Solid State Drive (SSD) devices and operations expected to commence in the second quarter of this year.

“Given the supply constraint globally, it is absolutely critical that our Penang project goes full swing to manage the supply chain. With the synergistic support from the Federal government agencies especially Malaysian Investment Development Authority (MIDA) and the State government agencies, our greenfield project is chartering in lightning speed to ramp up capacity to our major customers in this region” said Jeffery Chun, the Managing Director at Simmtech Southeast Asia.

Arham Abdul Rahman, Chief Executive Officer of MIDA shared, “The Electrical and Electronics (E&E) manufacturing industry is rapidly evolving. More and more companies are demanding knowledge-intensive, hi-tech and innovative activities. MIDA is targeting more front-end and back-end semiconductor players as well as their supply chains to consider

Malaysia as an alternative site for their production. MIDA welcomes Simmtech and their prospects in nurturing Malaysians to equip themselves with the technological skills for the current industry’s needs and beyond. We are confident that Simmtech will only stand to gain here in Malaysia.”

The project will be invested via its Malaysian subsidiary, Sustio Sdn Bhd with the total investment of US$121.7 million (RM508 million) benefitting local businesses with opportunities to be integrated in the global value chain.

The new factory in Penang is anticipated to create more than 1,000 high-skilled jobs in engineering, manufacturing and quality management, by the first half of 2022.

According to Chun, once it is in full swing, the production capacity in Penang will represent 20% of Simmtech Group’s current combined capacity in South Korea, China and Japan.

Furthermore, through the new substrate and PCB factory, Malaysia’s robust ecosystem as a hub for advanced manufacturing will be strengthened, while serving as an important link in driving the global semiconductor value chain. Amidst a depleted supply of chips globally, the steady surge in demand for high-performance computing and memory products catalysed the customers to design co-development programmes with Simmtech to get the products from the newly certified facility, and successfully multiply mass production in the shortest turnover time.

Chun added, “With this co-development programme with our key customers, we are confident that our project will not only be completed in time and primed for the market, but also be ready for production at full capacity as soon as we commence operations next year.”

As one of the world’s largest players in the semiconductor industry, the Penang factory serving as a manufacturing plant for the region’s first packaging substrates will position Simmtech as a differentiator from competitors, thereby jumpstarting the dynamics of the global chips shortage.

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