India's CG Power to form JV with Renesas, Thai Stars for $222 mln-chip plant

Renesas Electronics

09/02/2024 12:05

BENGALURU, Feb 9 (Reuters) - CG Power and Industrial
Solutions  CGPO.NS  said it has partnered with a unit of
Japanese chipmaker Renesas Electronics  6723.T  and Thailand's
Stars Microelectronics  SMT.BK  to set up a semiconductor
facility in India for $222 million. 
    The Indian heavy electrical equipment maker will form a
joint venture (JV) with Renesas Electronics America and the Thai
electronic parts maker to set up an outsourced semiconductor
assembly and testing (OSAT) facility, it said late on Thursday. 
    An OSAT plant packages, assembles and tests foundry-made
silicon wafers, turning them into finished semiconductor chips.
    Renesas and Stars will hold 6.76% and 0.9% stakes,
respectively, in the joint venture, while CG Power will own the
majority 92.34% stake. 
    The deal comes at a time when India is aiming to kickstart
domestic manufacturing of chips by doling out about $10 billion
in incentives for the sector.
    While the country does not yet have any semiconductor
manufacturing plants, Taiwan's Foxconn  2317.TW  and Indian
oil-to-metals conglomerate Vedanta  VDAN.NS  are in the fray to
make chips in India. 
    Shares of CG Power ended mostly flat on Friday. 

 (Reporting by Hritam Mukherjee in Bengaluru; Editing by Eileen
Soreng)
 ((Hritam.Mukherjee@thomsonreuters.com; X: @MukherjeeHritam;))