MEMC Electronic Materials
Encyclopedia
MEMC Electronic Materials is a United States
manufacturer of silicon wafers for the semiconductor
industry. The company's stock is part of the S&P 500
stock index. Originally established in 1959 as the Monsanto Electronic Materials Company, a business unit of Monsanto Company, the company is based in St. Peters, Missouri.
Ahmad Chatila is the current President
and Chief Executive Officer
of MEMC. Mr. Chatila was appointed President and Chief Executive Officer
and a member of the Board of Directors of MEMC on March, 2nd 2009.
. In the same year MEMC starts the production of 19-mm-silicon
-Wafers in St. Charles County, Missouri
. As one of the first corporations to produce semiconductor wafers, MEMC is considered a pioneer in this field, its innovations becoming industry standard for years. MEMC uses the Czochralski process
, develops Chemical Mechanical Polishing (CMP) and starts production of 1,5-inch-wafer
s. In 1966 MEMC installs the first reactors for production of EPI-wafers and develops zero-dislocation-crystal-growing.
(Malaysia). Step by step diameters of wafers are increased to 5 inches. In 1981 MEMC constructs a production and R&D-facility in Japan
, specifically in Utsunomiya, as the first non-Japanese corporation. 3 years later the production of 200 mm wafers is started by MEMC on economic scale, with the corporation taking on a pioneering role again.
In 1989 MEMC is bought by Dynamite Nobel
Silicons (DNS), a subsidy of the german Hüls AG, which itself is part of the German VEBA
AG. DNS already operates silicon wafer plants in Meran and Novara
, Italy
and integrates them within the new MEMC Electronic Materials, Inc. Hüls supports the new subsidy with 50 million USD, mainly used for research and development. MEMC starts the production of granular polysilicon in 1991 and as the first company produces 300 mm wafers on a commercial scale in 1991. Four years later MEMC acquires production capacities for granular polysilicon in Pasadena
, Texas
.
Trading of MEMCs stock at the New York Stock Exchange
starts after an initial public offering
in 1995. VEBA can convert part of its stock into 440 million USD but retains the majority voting rights in the corporation. The cyclical downturn in the semicondutor business hits MEMC hard. In 1998 the company has to report a loss of 316 million USD with revenues of 759 million USD. A significant improvement in turnover and earnings figures cannot be achieved in the following years.
In June 2000 VEBA AG, still holding 72 % of MEMC, is merged with VIAG
to form the new E.ON
AG. E.ON wants to focus on its core businesses and assigns Merrill Lynch
to sell MEMC. Merrill is unable to find a buyer until MEMC announces to be on the verge of illiquidity in the middle of the year. Finally E.ON is able to agree on a deal with the private-equity-company Texas Pacific Group
(TPG). MEMC is sold for a symbolic dollar and 150 million USD in credit lines.
By restructuring the debt of MEMC TPG is able to raise its share on the company. TPG conducts cost cutting measurements and cuts the number of employees from 7,000 to 4,000. In addition it convinces customers that MEMC will stay in business. The market share of MEMC rises again and by 2002 MEMC is able to report positive earning figures.
After a significant improvement of key figures, in 2005 TPG reduces its share on MEMC to 34 % through a secondary offering. The revenue of this transaction is more than 750 million USD, none of them going to the coffers of MEMC.
, Tainergy Tech , Gintech Energy or Conergy
.
Based on high spot price
s these contracts do not only guarantee high delivery volumes at fixed prices, but MEMC is also able to collect significant prepayments. Already in the middle of 2008 the significant drop in prices for solar wafers leads to disputes over those long term agreements. MEMC has to cut the deal with Conergy with a volume of 8 billion USD in half. Despite that Conergy applies to the courts to declare the contract invalid and void. Only in 2010 do both companies agree to renegotiate the deal out of court. MEMC has to agree on a reduction of the sales volume to less than one billion USD as the original contractual conditions would place Conergy in an economic position it could not survive.
- specialized on construction and operation of photovoltaic plants - found a joint venture
to erect a photovoltaic plant with 50 MWp in Straßkirchen
, Bavaria
. Both partners invest 100 million USD each, in return for a 50 % ownership on the project. As planned, the plant is sold to an alternative energy fund of Nordcapital after operations started at the beginning of 2010.
At the end of 2009 MEMC buys SunEdison
, a North-American company planning large-scale photovoltaic projects, and financing, constructing and operating them. SunEdison is the largest operator of solar power plants in North America. The company is taken over for 200 million USD, 70 per cent thereof paid in shares of MEMC, 30 % in cash. An additional 90 million USD have to be paid depending on target achievement in 2010.
MEMC acquires the California-based solar tech company Solaicx mid-2010. By paying 76 million USD, MEMC gets access to the continuous crystal pulling technology of Solaicx, which enables the production of cheap mono-crystalline solar wafers.
In February 2011 Samsung Fine Chemicals and MEMC announced a 50/50-Joint Venture to build a polysilicon production plant in Ulsan, South-Korea. The plant will have an initial capacity of 10,000 tons per annum.
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
manufacturer of silicon wafers for the semiconductor
Semiconductor
A semiconductor is a material with electrical conductivity due to electron flow intermediate in magnitude between that of a conductor and an insulator. This means a conductivity roughly in the range of 103 to 10−8 siemens per centimeter...
industry. The company's stock is part of the S&P 500
S&P 500
The S&P 500 is a free-float capitalization-weighted index published since 1957 of the prices of 500 large-cap common stocks actively traded in the United States. The stocks included in the S&P 500 are those of large publicly held companies that trade on either of the two largest American stock...
stock index. Originally established in 1959 as the Monsanto Electronic Materials Company, a business unit of Monsanto Company, the company is based in St. Peters, Missouri.
Ahmad Chatila is the current President
President
A president is a leader of an organization, company, trade union, university, or country.Etymologically, a president is one who presides, who sits in leadership...
and Chief Executive Officer
Chief executive officer
A chief executive officer , managing director , Executive Director for non-profit organizations, or chief executive is the highest-ranking corporate officer or administrator in charge of total management of an organization...
of MEMC. Mr. Chatila was appointed President and Chief Executive Officer
Chief executive officer
A chief executive officer , managing director , Executive Director for non-profit organizations, or chief executive is the highest-ranking corporate officer or administrator in charge of total management of an organization...
and a member of the Board of Directors of MEMC on March, 2nd 2009.
Foundation
Monsanto Electronic Materials Company (MEMC) was established on August 6, 1959 as part of the US-based multinational corporation MonsantoMonsanto
The Monsanto Company is a US-based multinational agricultural biotechnology corporation. It is the world's leading producer of the herbicide glyphosate, marketed in the "Roundup" brand of herbicides, and in other brands...
. In the same year MEMC starts the production of 19-mm-silicon
Silicon
Silicon is a chemical element with the symbol Si and atomic number 14. A tetravalent metalloid, it is less reactive than its chemical analog carbon, the nonmetal directly above it in the periodic table, but more reactive than germanium, the metalloid directly below it in the table...
-Wafers in St. Charles County, Missouri
Missouri
Missouri is a US state located in the Midwestern United States, bordered by Iowa, Illinois, Kentucky, Tennessee, Arkansas, Oklahoma, Kansas and Nebraska. With a 2010 population of 5,988,927, Missouri is the 18th most populous state in the nation and the fifth most populous in the Midwest. It...
. As one of the first corporations to produce semiconductor wafers, MEMC is considered a pioneer in this field, its innovations becoming industry standard for years. MEMC uses the Czochralski process
Czochralski process
The Czochralski process is a method of crystal growth used to obtain single crystals of semiconductors , metals , salts, and synthetic gemstones...
, develops Chemical Mechanical Polishing (CMP) and starts production of 1,5-inch-wafer
Wafer (electronics)
A wafer is a thin slice of semiconductor material, such as a silicon crystal, used in the fabrication of integrated circuits and other microdevices...
s. In 1966 MEMC installs the first reactors for production of EPI-wafers and develops zero-dislocation-crystal-growing.
Expansion
During the 70s MEMC opens a production plant in Kuala LumpurKuala Lumpur
Kuala Lumpur is the capital and the second largest city in Malaysia by population. The city proper, making up an area of , has a population of 1.4 million as of 2010. Greater Kuala Lumpur, also known as the Klang Valley, is an urban agglomeration of 7.2 million...
(Malaysia). Step by step diameters of wafers are increased to 5 inches. In 1981 MEMC constructs a production and R&D-facility in Japan
Japan
Japan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south...
, specifically in Utsunomiya, as the first non-Japanese corporation. 3 years later the production of 200 mm wafers is started by MEMC on economic scale, with the corporation taking on a pioneering role again.
Change of Ownership
High price pressure from Japanese competition leads to an ever increasing pressure on MEMC during the 80s. Despite increasing revenues MEMC has to account for losses for several years, leading to the decision of Monsanto to sell the company.In 1989 MEMC is bought by Dynamite Nobel
Dynamit Nobel AG
Dynamite Nobel AG is a German chemical and weapons company whose headquarters was based in Troisdorf. It was founded in 1865 by Alfred Nobel.-Creation:...
Silicons (DNS), a subsidy of the german Hüls AG, which itself is part of the German VEBA
VEBA
VEBA AG was a German energy company. VEBA was founded in 1929 as a holding company owned by the state of Prussia, and was privatized in 1965. VEBA became a part of E.ON in 2000....
AG. DNS already operates silicon wafer plants in Meran and Novara
Novara
Novara is the capital city of the province of Novara in the Piedmont region in northwest Italy, to the west of Milan. With c. 105,000 inhabitants, it is the second most populous city in Piedmont after Turin. It is an important crossroads for commercial traffic along the routes from Milan to Turin...
, Italy
Italy
Italy , officially the Italian Republic languages]] under the European Charter for Regional or Minority Languages. In each of these, Italy's official name is as follows:;;;;;;;;), is a unitary parliamentary republic in South-Central Europe. To the north it borders France, Switzerland, Austria and...
and integrates them within the new MEMC Electronic Materials, Inc. Hüls supports the new subsidy with 50 million USD, mainly used for research and development. MEMC starts the production of granular polysilicon in 1991 and as the first company produces 300 mm wafers on a commercial scale in 1991. Four years later MEMC acquires production capacities for granular polysilicon in Pasadena
Pasadena, Texas
Pasadena is a city in the U.S. state of Texas within the metropolitan area. It is the second-largest city in Harris County, 17th-largest in Texas, and 162nd largest in the United States. The area was founded in 1893 by John H. Burnett of Galveston....
, Texas
Texas
Texas is the second largest U.S. state by both area and population, and the largest state by area in the contiguous United States.The name, based on the Caddo word "Tejas" meaning "friends" or "allies", was applied by the Spanish to the Caddo themselves and to the region of their settlement in...
.
Trading of MEMCs stock at the New York Stock Exchange
New York Stock Exchange
The New York Stock Exchange is a stock exchange located at 11 Wall Street in Lower Manhattan, New York City, USA. It is by far the world's largest stock exchange by market capitalization of its listed companies at 13.39 trillion as of Dec 2010...
starts after an initial public offering
Initial public offering
An initial public offering or stock market launch, is the first sale of stock by a private company to the public. It can be used by either small or large companies to raise expansion capital and become publicly traded enterprises...
in 1995. VEBA can convert part of its stock into 440 million USD but retains the majority voting rights in the corporation. The cyclical downturn in the semicondutor business hits MEMC hard. In 1998 the company has to report a loss of 316 million USD with revenues of 759 million USD. A significant improvement in turnover and earnings figures cannot be achieved in the following years.
In June 2000 VEBA AG, still holding 72 % of MEMC, is merged with VIAG
VIAG
VIAG can refer to:* The ICAO airport code for Agra Airport in India* VIAG, a German energy corporation that merged with VEBA in 2000 to form E.ON...
to form the new E.ON
E.ON
E.ON AG, marketed with an interpunct as E•ON, is the holding company of the world's largest investor-owned energy service provider based in Düsseldorf, Germany. The name comes from the Greek word aeon which means eternity....
AG. E.ON wants to focus on its core businesses and assigns Merrill Lynch
Merrill Lynch
Merrill Lynch is the wealth management division of Bank of America. With over 15,000 financial advisors and $2.2 trillion in client assets it is the world's largest brokerage. Formerly known as Merrill Lynch & Co., Inc., prior to 2009 the firm was publicly owned and traded on the New York...
to sell MEMC. Merrill is unable to find a buyer until MEMC announces to be on the verge of illiquidity in the middle of the year. Finally E.ON is able to agree on a deal with the private-equity-company Texas Pacific Group
Texas Pacific Group
TPG Capital is one of the largest private equity investment firms globally, focused on leveraged buyout, growth capital and leveraged recapitalization investments in distressed companies and turnaround situations. TPG also manages investment funds specializing in growth capital, venture capital,...
(TPG). MEMC is sold for a symbolic dollar and 150 million USD in credit lines.
By restructuring the debt of MEMC TPG is able to raise its share on the company. TPG conducts cost cutting measurements and cuts the number of employees from 7,000 to 4,000. In addition it convinces customers that MEMC will stay in business. The market share of MEMC rises again and by 2002 MEMC is able to report positive earning figures.
After a significant improvement of key figures, in 2005 TPG reduces its share on MEMC to 34 % through a secondary offering. The revenue of this transaction is more than 750 million USD, none of them going to the coffers of MEMC.
Solar Market Entry
With the boom of the photovoltaic industry MEMC is able to agree on several long term contracts for delivery of solar wafers. Starting in 2006 a volume of several billion USD is contracted, e.g. with Suntech PowerSuntech Power
Suntech Power Holdings Co., Ltd. is the world's largest producer of solar panels, with 1,800MW of annual production capacity by the end of 2010. With offices or production facilities in every major market, Suntech has delivered more than 13,000,000 solar panels to thousands of companies in more...
, Tainergy Tech , Gintech Energy or Conergy
Conergy
Conergy AG is a company in the solar energy industry founded in 1998 by the former chairman of the board Hans-Martin Rüter. It had a turnover of 706 Million euros in 2007, and employs more than 2000 staff. It also has a company called Conergy Americas....
.
Based on high spot price
Spot price
The spot price or spot rate of a commodity, a security or a currency is the price that is quoted for immediate settlement . Spot settlement is normally one or two business days from trade date...
s these contracts do not only guarantee high delivery volumes at fixed prices, but MEMC is also able to collect significant prepayments. Already in the middle of 2008 the significant drop in prices for solar wafers leads to disputes over those long term agreements. MEMC has to cut the deal with Conergy with a volume of 8 billion USD in half. Despite that Conergy applies to the courts to declare the contract invalid and void. Only in 2010 do both companies agree to renegotiate the deal out of court. MEMC has to agree on a reduction of the sales volume to less than one billion USD as the original contractual conditions would place Conergy in an economic position it could not survive.
Recent Developments
In 2009 MEMC and Q-CellsQ-Cells
Q-Cells is a manufacturer of photovoltaic cells, established in 1999. Its core business is the development, production and marketing of crystalline silicon photovoltaic cells....
- specialized on construction and operation of photovoltaic plants - found a joint venture
Joint venture
A joint venture is a business agreement in which parties agree to develop, for a finite time, a new entity and new assets by contributing equity. They exercise control over the enterprise and consequently share revenues, expenses and assets...
to erect a photovoltaic plant with 50 MWp in Straßkirchen
Straßkirchen
Straßkirchen is a municipality in the district of Straubing-Bogen in Bavaria in Germany....
, Bavaria
Bavaria
Bavaria, formally the Free State of Bavaria is a state of Germany, located in the southeast of Germany. With an area of , it is the largest state by area, forming almost 20% of the total land area of Germany...
. Both partners invest 100 million USD each, in return for a 50 % ownership on the project. As planned, the plant is sold to an alternative energy fund of Nordcapital after operations started at the beginning of 2010.
At the end of 2009 MEMC buys SunEdison
SunEdison
Sun Edison LLC owns and operates power plants in North America and provides solar-generated energy to commercial, government, and utility customers. The company provides solar energy services, which include renewable power, monitoring, marketing, renewable portfolio standards, and solar tariff...
, a North-American company planning large-scale photovoltaic projects, and financing, constructing and operating them. SunEdison is the largest operator of solar power plants in North America. The company is taken over for 200 million USD, 70 per cent thereof paid in shares of MEMC, 30 % in cash. An additional 90 million USD have to be paid depending on target achievement in 2010.
MEMC acquires the California-based solar tech company Solaicx mid-2010. By paying 76 million USD, MEMC gets access to the continuous crystal pulling technology of Solaicx, which enables the production of cheap mono-crystalline solar wafers.
In February 2011 Samsung Fine Chemicals and MEMC announced a 50/50-Joint Venture to build a polysilicon production plant in Ulsan, South-Korea. The plant will have an initial capacity of 10,000 tons per annum.
Business Segments
Since the acquisition of SunEdison MEMC has three reporting segments.- Semiconductor Wafers delivers wafers to the electronics industry. Products of MEMC include 300 mm wafers, production capacities allow for 2 million wafers per month. Apart from plants in Asia (Utsunomiya, JapanJapanJapan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south...
; ChonanChonanChonan may refer to:*Chōnan, the Japanese moniker for the eldest son in a family.*Chōnan, Chiba, a town in Japan*Cheonan, a city in South Korea**Battle of Chonan, a battle in the city during the Korean War...
(South KoreaSouth KoreaThe Republic of Korea , , is a sovereign state in East Asia, located on the southern portion of the Korean Peninsula. It is neighbored by the People's Republic of China to the west, Japan to the east, North Korea to the north, and the East China Sea and Republic of China to the south...
); (Taisil), TaiwanTaiwanTaiwan , also known, especially in the past, as Formosa , is the largest island of the same-named island group of East Asia in the western Pacific Ocean and located off the southeastern coast of mainland China. The island forms over 99% of the current territory of the Republic of China following...
; Kuala LumpurKuala LumpurKuala Lumpur is the capital and the second largest city in Malaysia by population. The city proper, making up an area of , has a population of 1.4 million as of 2010. Greater Kuala Lumpur, also known as the Klang Valley, is an urban agglomeration of 7.2 million...
und IpohIpohIpoh is the capital city of Perak state, Malaysia. It is approximately 200 km north of Kuala Lumpur on the North-South Expressway....
(both Malaysia) MEMC operates a production facility in NovaraNovaraNovara is the capital city of the province of Novara in the Piedmont region in northwest Italy, to the west of Milan. With c. 105,000 inhabitants, it is the second most populous city in Piedmont after Turin. It is an important crossroads for commercial traffic along the routes from Milan to Turin...
(ItalyItalyItaly , officially the Italian Republic languages]] under the European Charter for Regional or Minority Languages. In each of these, Italy's official name is as follows:;;;;;;;;), is a unitary parliamentary republic in South-Central Europe. To the north it borders France, Switzerland, Austria and...
). Production plants in the United StatesUnited StatesThe United States of America is a federal constitutional republic comprising fifty states and a federal district...
(St. Peters, (MissouriMissouriMissouri is a US state located in the Midwestern United States, bordered by Iowa, Illinois, Kentucky, Tennessee, Arkansas, Oklahoma, Kansas and Nebraska. With a 2010 population of 5,988,927, Missouri is the 18th most populous state in the nation and the fifth most populous in the Midwest. It...
), ShermanSherman, TexasSherman is a city in and the county seat of Grayson County, Texas, United States. The city's estimated population as of 2009 was 38,407. It is also one of two principal cities in the Sherman-Denison Metropolitan Statistical Area.-History:...
(TexasTexasTexas is the second largest U.S. state by both area and population, and the largest state by area in the contiguous United States.The name, based on the Caddo word "Tejas" meaning "friends" or "allies", was applied by the Spanish to the Caddo themselves and to the region of their settlement in...
)) are scheduled to be closed and capacities to be moved to Asia. MEMC produces polished and epitaxial wafers, High Resistivity Wafers and SOI Wafers. Main competition in this segment comes from SUMCOSUMCOis a Japanese company. It is listed on the Nikkei 225....
, ShinEtsu, SiltronicSiltronicSiltronic AG，is a Munich based company, which is one of the top Silicon Wafer suppliers in the world. It is 100% owned by Wacker Chemie AG and the single european-based Wafer supplier....
and Siltron. The market share of MEMC is roughly 12 per cent.
- Solar Materials: MEMC produces Polysilicon in purities useable in the solar and semiconductor industry in PasadenaPasadena, TexasPasadena is a city in the U.S. state of Texas within the metropolitan area. It is the second-largest city in Harris County, 17th-largest in Texas, and 162nd largest in the United States. The area was founded in 1893 by John H. Burnett of Galveston....
, (TexasTexasTexas is the second largest U.S. state by both area and population, and the largest state by area in the contiguous United States.The name, based on the Caddo word "Tejas" meaning "friends" or "allies", was applied by the Spanish to the Caddo themselves and to the region of their settlement in...
)) and Merano, (ItalyItalyItaly , officially the Italian Republic languages]] under the European Charter for Regional or Minority Languages. In each of these, Italy's official name is as follows:;;;;;;;;), is a unitary parliamentary republic in South-Central Europe. To the north it borders France, Switzerland, Austria and...
). Production capacities equal 10,000 tons per annum, an expansion to 12,500 by the end of 2011 has been announced. The material is mainly used for their own following production steps, sales to the spot market did occur between 2006 and 2009. Apart from opportunistic sales of silanesSilanesSilanes are chemical compounds of silicon and hydrogen, which are analogues of alkane hydrocarbons. Silanes consist of a chain of silicon atoms covalently bonded to each other and to hydrogen atoms. The general formula of a silane is SinH2n+2...
the segment sells mainly solar wafers. As their own productions capacities of 600 MW are not sufficient, MEMC also has tolling partners to produce these wafers.
- SunEdison offers customers access to solar power without financing the individual projects generating the power. SunEdison collects capital from investors and uses it to construct photovoltaic plants (installing MEMC Solar Wafers in some cases). The plants are operated by SunEdison after construction. Investors receive a cash flow from sold solar power, including subsidies from governmental organizations. The solar power is sold to commercial, government, and utility customers.
Production facilities
| Location | Products | Ownership |
|---|---|---|
| Chonan, Korea | polished wafers | 80 % MEMC, 20 % Samsung |
| Hsinchu, Taiwan | polished and epitaxial wafers | MEMC |
| Kuala Lumpur, Malaysia | polished wafers | MEMC |
| Meran, Italy | mono-crystals, polysilicon | MEMC |
| Novara, Italy | polished and epitaxial wafers | MEMC |
| Pasadena, Texas, USA | granular polysilicon, monosilanes, SiF4 gases | MEMC |
| St. Peters, Missouri, USA | 100mm - 300mm wafers | MEMC |
| Sherman, Texas, USA | 200mm wafers | MEMC |
| Utsunomiya, Japan | 125mm - 300mm wafers | MEMC |