Photronics Inc. has spent $320 million on two new facilities in China for the research and development, manufacture, and sale of photomasks, in an effort to become a critical supplier in the Chinese electronics industry.

The new facilities are located in Xiamen and Hefei and will be the local supplier to the integrated circuit (IC) and flat panel display (FPD) industries.

The new manufacturing facility in Xiamen is the result of a $160 million investment agreement with Xiamen Torch, a national-level high-tech zone in China, announced in August 2016. The facility will support semiconductor manufacturing for a wide range of technologies and nodes in both logic and memory.

Plans are for initial production to ramp quickly at 40-nm and 28-nm nodes, with process introduction leading to 14-nm (and beyond) nodes shortly thereafter. The facility, Photronics DNP Mask Corporation Xiamen, is part of a joint venture between Photronics and Dai Nippon Printing Co. Ltd.

The location in Xiamen was selected on account of the established technology park, close proximity to a large customer, and the existing supply chain infrastructure. When fully ramped, the facility will employ approximately 170 people, including manufacturing, engineering, sales, facilities, and finance support functions.

The facility in Hefei is wholly owned and focused on the flat panel display industry. Created under a $160 million investment agreement formed in August 2017 with the Hefei State High-tech Industry Development Zone (High-tech Zone) to establish a manufacturing facility in Hefei, the factory is equipped to support Generation 10.5+ (G10.5+) substrate production.

With this investment, Photronics is the first producer of G10.5+ photomasks in China. The cleanroom is fully automated, and the facility will employ approximately 70 people in manufacturing and supporting functions.