A $290M Deal Between TSMC And SMIC

A $290M Deal Between TSMC And SMIC

17th November 2009

There had been a case of theft of trade secrets, violation of the patent and also the breaking of the contract between Taiwan semiconductor manufacturing i.e. TSMC and the biggest chip making company of China, Semiconductor manufacturing international i.e. SMIC. The case was won by TSMC and they have decided for an out of court settlement. This settlement is of the amount of $290M.

Because of the case won by TSMC, SMIC will have to pay this much amount in cash and will also have to give them its stock as well as the warrants. After paying all of these things to TSMC, SMIC will be giving 10 percent stake to TSMC. These stocks and warrants had already been valued at an amount of $90.2M. This was done so by Steve Change from Taishin securities in Taipei.

Almost a week back, there had been a hearing with the jury of superior court in the Alameda county at California. That jury also gave its decision in favor of TSMC against SMIC. We should keep in mind that TSMC is the largest contract chip making company in the whole world, whereas SMIC is the biggest contract chip making company of China. The proceedings of that court were started as to find out the damages caused to the company.