VIENNA, Jan 22 (Reuters) - Austrian printed circuit board group AT&S will invest around 350 million euros ($466 million) to enter the business of producing integrated circuit (IC) substrates in China, it said on Tuesday.
The move reflects a trend toward convergence of producing semiconductors and printed circuit boards, it said in a statement. IC substrates connect semiconductors and printed circuit boards.
AT&S cited estimates that the market for IC substrate packages could reach $11.8 billion in 2016 from close to $8.6 billion now. It expects to start getting sales in the segment from 2016.
"The production of IC substrates will be in China. AT&S will build up the necessary know-how with support by a leading semiconductor manufacturer and will enter the market in close cooperation," it said, adding a production facility was under construction in Chongqing, China. It did not elaborate.
"From today's perspective AT&S foresees investments of around 350 million euros, which excludes start-up costs."
AT&S generated record third-quarter revenues of 150 million euros and earnings before interest, tax, depreciation and amortisation of around 30.5 million.
It credited the launch of new models by smartphone manufacturers and stronger demand for high-end printed circuit boards in the premium automotive segment for its gains.
$1 = 0.7510 euros Reporting by Michael Shields; Editing by Mark Potter