TSMC and Sony to Invest $4.7 Billion in Joint Venture for Next-Generation Image Sensors
Key Takeaways
- •Sony will hold a controlling stake in the joint venture, investing 465 billion yen ($2.92 billion) including its newly constructed Kumamoto factory, while TSMC will contribute 282 billion yen.
- •The new company, Advanced Vision Semiconductor Manufacturing Corp., will be headquartered in Kumamoto and is expected to begin volume production in 2029.
- •The venture will focus on next-generation image sensors for smartphones, with expanding applications in automotive cameras, augmented and virtual reality devices, and industrial automation.
- •Sony will lead core image sensor development, product planning, and design, while TSMC will provide its advanced process technology and manufacturing expertise.
- •The companies expect Japanese government subsidies to help fund the additional capital needed to reach the planned production capacity.
By Ben Blanchard and Wen-Yee Lee
TAIPEI, Aug 11 (Reuters) — Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chipmaker, and Sony Group Corp. said on Tuesday they will establish a $4.69 billion joint venture to develop and manufacture next-generation image sensors in southern Japan, with volume production expected to begin in 2029.
Sony will serve as the controlling shareholder, investing 465 billion yen ($2.92 billion) through a combination of cash and asset transfers, including its newly constructed chip factory in Kumamoto prefecture. TSMC will contribute 282 billion yen, the companies said in a joint statement.
Stock movements at the time of the announcement:
- TSMC (TSM): -0.37%
- Sony Group (SONY): +1.53%
The new entity, named Advanced Vision Semiconductor Manufacturing Corp., will be headquartered in Kumamoto, where TSMC already operates its Japan Advanced Semiconductor Manufacturing (JASM) chip plant — a facility that marked TSMC's first major manufacturing expansion in Japan. The Kumamoto region has emerged as a focal point for Japan's efforts to rebuild its domestic semiconductor manufacturing base, a priority the Japanese government has pursued through subsidies and partnerships with foreign chipmakers.
The joint venture is intended to function as a central hub for the development and production of image sensors used in smartphones, leveraging advanced manufacturing technology. Sony, which is the global leader in CMOS image sensors supplying major smartphone makers worldwide, will lead the development of core image sensor technologies as well as product planning and design. The venture will draw on TSMC's advanced process technology and extensive manufacturing expertise. While smartphones remain the primary market, next-generation image sensors are increasingly relevant to automotive cameras, augmented and virtual reality devices, and industrial automation applications.
Capital contributions from both companies will be made in phases, depending on market demand and other business conditions, according to the statement. In addition to the investments by Sony and TSMC, the companies indicated that additional funding required to reach the planned production capacity is being considered on the assumption that Japanese government support will be available.
The companies first announced plans for the venture in May.
($1 = 159.3300 yen)
(Reporting by Ben Blanchard and Wen-Yee Lee; Editing by Andrew Heavens and Mark Potter)