Tessolve to set up chip plant in India

By agencies   |   Tuesday, 28 February 2006, 08:00 Hrs
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BANGALORE: Tessolve Services, a California-based semiconductor manufacturer that does most of its development work in Bangalore, announce to invest $200 million in India over four years.

The company official said the investment is to build an assembly and testing plant for semiconductors. However, they did not disclose where the plant would be located. And maintain the suspense by stating that it would be built either in Karnataka, Andhra Pradesh, or Tamil Nadu.

Tessolve plans to invest $50 million in the plant by July 2006. The facility is expected to be operational by early 2007. By May 2006, an overseas partner will also be involved, suggested Tessolve CEO P Raja Manickam.

Tessolve is not the only company to announced plans recently to build a chip factory in India. Earlier this month, SemIndia, a semiconductor-manufacturing company set up by a consortium of Indians in the U.S. and other investors, finalized plans to set up another chip-manufacturing plant in Andhra Pradesh.

Manickam believes the challenge is to ensure that the order books are full to eliminate idle capacity. “A critical mass is needed as it does not make business sense to keep expensive testing equipment idle,” he said.

Engineers of Indian origin founded the company in the U.S. Unlike a typical Indian assembly and testing firm, Tessolve plans to provide input beginning at the design stage.

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