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Source: Showa Denko K.K.
Showa Denko Concludes MOU with SK Inc. to Give Consideration to a Plan to Cooperatively Produce High-Purity Gases for Semiconductors in North America
Aiming to Start Production of High Purity Gases in the US

TOKYO, June 29, 2022 - (ACN Newswire) - On June 29, 2022, Showa Denko K.K. (SDK) (TOKYO: 4004) and SK Incorporated concluded a memorandum of understanding (MOU) to give consideration to a plan to start cooperative work to produce high-purity gases, which are used in semiconductor production processes, in North America.

While semiconductor markets in various countries continue growing and geopolitical risks are increasing, the US Government has embarked on strengthening domestic semiconductor industry and inviting supply chain of semiconductors into the country. As a result of this movement, large manufacturers of semiconductors are increasing their capital investment in the United States, and the demand for materials for semiconductors in the country is growing. Supply-demand balance of high-purity gases for wiring process (front-end of semiconductor production process) in the US has been tightening. Therefore, many semiconductor manufacturers in the US want to secure stable supply of high-purity gases for semiconductors. On the other hand, SDK's business segment to produce high purity gases for semiconductors has established and continues strengthening high-purity gas supply chain in which the Company producing high-purity gases and filling it into cylinders in its Asian facilities, and transporting those cylinders to the US. Therefore, there are some problems to be solved including increases in transportation costs and potential instability in supply of high-purity gases when there is congestion in global logistics network.

To cope with these problems, SDK and SK Materials, which is an in-house independent company of SK Incorporated and produces high-purity gases for semiconductors, will start to give consideration to a plan to cooperatively produce high-purity gases for semiconductors in North America. In the global market for high-purity gases for semiconductors, SDK has the top share of the etching gas*1 market, and SK Materials has the top share of the cleaning gas*2 market and deposition gas*3 market. Thus, the two leading companies in the high-purity gas industry are now aiming to expand their business in the US cooperatively.

In 2017, SDK and SK Materials established a joint corporation named SK Showa Denko, Co., Ltd. which produces and sells high-purity gases for semiconductors, and, in the Republic of Korea, they cooperatively produce CH3F, which is used mainly as etching gas for silicon nitride film. Now SK Showa Denko is constructing a new plant to produce HBr in the Republic of Korea, and the new plant is expected to be finished in July, 2022.

As a "Co-creative Chemical Company," the Sowa Denko Group has positioned its electronics business including the business to produce and sell high-purity gases for semiconductors as Core-growth Business, and has been focusing on this electronics business, aiming to contribute to sustainable development of the global society. The Showa Denko Group will continue making its electronics business grow by responding rapidly to the growth of semiconductor market and continuing supply of leading-edge products.

*1. Etching gas is used in etching process, which is a process to carve fine grooves and holes on the surface of wafers in order to make up electronic circuits, etc.
*2. Cleaning gas is used to clean up inside of semiconductor chip production equipment.
*3. Deposition gas forms silicon oxide film or silicon nitride film on the surface of wafers.

About Showa Denko K.K.

Showa Denko K.K. (SDK; TSE:4004, ADR:SHWDY) is a major manufacturer of chemical products serving from heavy industry to computers and electronics. The Petrochemicals Sector provides cracker products such as ethylene and propylene, the Chemicals Sector provides industrial, high-performance and high-purity gases and chemicals for semicon and other industries, the Inorganics Sector provides ceramic products, such as alumina, abrasives, refractory/graphite electrodes and fine carbon products. The Aluminum Sector provides aluminum materials and high-value-added fabricated aluminum, the Electronics Sector provides HD media, compound semiconductors such as ultra high bright LEDs, and rare earth magnetic alloys, and the Advanced Battery Materials Department (ABM) provides lithium-ion battery components. For more information, please visit www.sdk.co.jp/english/.

Media contact:
Showa Denko K.K., Public Relations Group, Brand Communication Department, Tel: 81-3-5470-3235

Topic: Press release summary
Source: Showa Denko K.K.

Sectors: Electronics, Chemicals
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