Hynix to Accelerate Retirement of 200mm Fabrication Plants

Hynix Semiconductor said that the Company will retire 200mm wafer fabrication plant (“FAB”) which is less efficient than 300mm FAB, earlier than planned in order to improve its financial stability and focus on profitability.

Hynix has total five 200mm FABs including M7 in Icheon, M8 and M9 in Cheongju, E1 in Eugene, United States and HC1 in Wuxi, China. In order to accelerate the retirement of 200mm FABs, Hynix previously announced stopping operations at HC1, E1 and M9 FABs. In addition to the retirement of those 200mm FABs, M7 FAB which has exclusively produced DRAM will be closed by the end of this month.

M8 FAB, the last 200mm FAB after retirement of other FABs, will be producing smaller volume than its original production plan of 130,000 wafers per month, focusing on specialty products. In this regard, the total production output from 200mm FABs will be significantly reduced to less than 10% of total capacity in the beginning of year 2009 compared to 50% at the end of year 2007.

By closing 200mm FABs, the total production capacity will decrease 30% by the beginning of next year from that of the second quarter end of this year. This feature also indicates reducing 20% of DRAM and 40% of NAND Flash outputs.

In accordance with accelerating retirement of 200mm FABs, Hynix will convert most of its production of DRAM and NAND Flash from 200mm FABs to 300mm FABs. With this move, the Company will keep strengthening its stance as a leading player in the industry through technology advancement and cost competitiveness while improving cash flow and profitability.

Hynix Semiconductor