SMIC forms joint venture for 28nm production

SMIC and its subsidiary SMIC Beijing are entering into the joint venture with Beijing Industrial Development Investment Management Corp. (BIDIMC) and Zhongguancun Development Group (ZDG). SMIC will be responsible for managing the daily operations of the joint venture called Northern SMIC Semiconductor Manufacturing (Beijing) Co. Ltd., according to reports.
BIDIMC is a state-owned company with all its capital contributed by Beijing State-owned Assets Management Co., Ltd. ZDG represents the Zhongguancun Science Park in Beijing. The total investment for Northern SMIC is estimated to be $3.59 billion with an initial capitalization of $1.2 billion contributed by the parties in the form of registered capital. Of the initial funding SMIC and SMIC Beijing have agreed to contribute $660 million or 55 percent and ZDG and BIDIMC are set to contribute 45 percent or $540 million. The remaining money is to be funded through loans, further funding and cash flow, SMIC said.