SKC to acquire 12% stake in US chip packaging startup Chipletz

SKC Ltd., a South Korean chemical materials company, said on Monday it will take part in a series B round of investment in Chipletz, a US fabless substrate startup that specializes in semiconductor packaging.

SKC said it expects to take about a 12% stake in Chipletz following the investment, although the exact size of its shareholding will be determined after the funding round ends.

The Korean company didn’t disclose its investment amount, citing a confidentiality agreement with Chipletz.

Based in Austin, Texas, Chipletz started as an internal venture company of Advanced Micro Devices Inc. (AMD) in 2016 and was spun off as a separate entity in 2021.

The company is developing a technology called smart substrate, which supports the integration of almost any die from manufacturers.

Chipletz’s founder and Chief Executive Bryan Black is a chip packaging expert who worked for Intel and AMD for over 20 years.

ASE, a Taiwanese chip assembly and test company, is also key investor in Chipletz.

Chip packaging is the final stage of semiconductor device fabrication to protect chip materials and connect the chips to a circuit board. Advanced packaging technology has become more important as chip capacity expansion through process technology is nearing its upper limit.

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SKC has been looking for small- to medium-sized semiconductor parts makers as acquisition targets as part of its business shift toward chip testing and battery materials.

In July, the company, through its investment arm SK Enpulse Co., acquired a 45% stake in semiconductor test equipment maker ISC Co. for 522.5 billion won ($400 million).

Established in 2001, ISC is the world’s No. 1 producer of semiconductor test sockets used for the post-manufacturing process of integrated circuit chips to assess their quality and find defects.

In 2021, SKC acquired US glass substrate maker Absolics Inc. for $240 million.

Absolics is currently building a plant in Covington, Georgia to produce next-generation glass substrate with an aim to commercialize the product as early as the second half of 2024.

Construction of the factory’s first-phase production facility is expected to be completed by the end of this year.

A glass substrate is a thin layer of glass on which memory chips are mounted to create the brain of a computing system.

With a thickness that is only a fourth that of a conventional printed circuit board (PCB), a glass substrate makes it easier to miniaturize chip packaging, significantly increasing the performance and energy efficiency of chipsets.

SKC Chief Executive Park Won-cheol said during its Investor Day forum in July that the company plans to invest over 5 trillion won in three growth sectors – secondary batteries, semiconductors and eco-friendly items – under a sales target of 7.9 trillion won in 2025 and 11 trillion won in 2027.

Having started as a videotape maker in 1976, SKC is striving to transform into a rechargeable battery and semiconductor materials company.

Write to Jae-Fu Kim at hu@hankyung.com

In-Soo Nam edited this article.