LONDON — Loss-making foundry Tower Semiconductor Ltd. (Migdal Haemek, Israel), which trades as TowerJazz, has announced it plans to transfer "manufacturing know-how and certain equipment" to support an un-named Asian company ramp up production.

Tower did not name the Asian entity nor what type of equipment or process knowledge it would be exporting. The company did say the deal would add approximately $130 million of revenue to TowerJazz, largely during the first contract year of 2010. Tower said the deal was in line with the company's corporate strategy of seeking to penetrate Asian markets and to leverage its manufacturing know-how and assets to expand its business in the region.

Tower makes ICs with geometries ranging from 1.0-micron to 0.13-micron. It also has a broad range of customizable process technologies including SiGe, BiCMOS, mixed-signal and RFCMOS, CMOS image sensor, power management (BCD), and non-volatile memory (NVM) as well as MEMS capabilities.

Tower acquired a 10 percent stake in Shanghai Hua Hong NEC Co. Ltd. (HHNEC) when it bought Jazz Semiconductor, which also had manufacturing deals with Advanced Semiconductor Manufacturing Corp. Ltd. (ASMC). It is not clear whether Tower is supporting one of these companies or another. A shakeout is underway in China and some observers expect HHNEC to merge with Grace Semiconductor Manufacturing Corp. (GSMC). Tower said it expects the project will lead to additional business opportunities through new customers and ventures.

"It is a notable achievement and acknowledgement of our capabilities that TowerJazz was chosen to provide the know-how, training, and turnkey manufacturing solutions to a project of this scope and significance," said Russell Ellwanger, chief executive officer of Tower, in a statement. "This project is accretive to our strategy to grow market share within Asia, as evidenced by the opening of a sales and technical support office in Korea this year with multiple design wins and customer announcements in that region, particularly within Power Management. Additionally, our ownership percentage, board representation and manufacturing agreement with HHNEC in Shanghai, China is further affirmation of our commitment to growth in Asia. We expect that this project will strengthen our traction in this geographic area and trust that our Asian customer base will multiply as a result."

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