LSI Logic completes $105 million sale of Gresham Fab to on Semiconductor

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LSI Logic Corporation (NYSE: LSI) today announced it has completed the sale of its Gresham, Oregon semiconductor manufacturing facility to Semiconductor Components Industries, LLC, the primary operating subsidiary of ON Semiconductor Corporation (Nasdaq: ONNN), for $105 million, under terms of a definitive agreement executed on April 5, 2006.


The facility purchased by the ON Semiconductor subsidiary consists of a campus measuring approximately 83 acres, multiple buildings with approximately 500,000 square feet of floor space, including approximately 98,000 square feet of cleanroom space, and a 200 millimeter-capable toolset and equipment that can produce 18,000 8-inch wafers per month.


Related to the transaction, the ON Semiconductor subsidiary has entered into additional agreements with LSI, including a multi-year wafer supply and test agreement, intellectual property license agreement, transition services agreement and a facilities use agreement. The ON Semiconductor subsidiary has also hired substantially all of the LSI manufacturing employees based at the Gresham site, with the remaining non-manufacturing workforce continuing their employment with LSI.


In September, 2005, LSI adopted a fabless manufacturing strategy intended to better serve its global customer base, reduce production costs and adopt leading-edge process technologies. The closing of this transaction completes the company’s transition to a fully fabless model while providing uninterrupted service to customers.


LSI has received approximately $90 million in proceeds to date, with the balance due within 90 days of closing according to the agreement.

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