SemIndia`s $3b Fabcity Project in Collaboration with AMD in India Faces Hurdles

Released on = April 20, 2007, 6:41 am

Press Release Author = Exclusive Ventures

Industry = Semiconductors

Press Release Summary = The proposed $3billion project for manufacture of
semiconductor chips at Hyderabad, India looks to be headed for trouble. The State
Govt. (Govt of Andhra Pradesh) is reported to have told SemIndia to either perform
or step out. Exclusive Ventures, reports.

Press Release Body = The Fabcity project by SemIndia, a Non Resident Indian
Initiative with initial funding by Venture Fund, Sandalwood Partners, was bagged by
the state of Andhra Pradesh by offering several incentives including allocation of
land, subsidized power and water. The project failed to take off in the year 2006,
since the policy frame-work to support Semiconductor Manufacturing was not in place,
in India. Subsequently, the Union Cabinet approved the Semiconductor Policy in
February 2007 and later on 22nd March 2007, the investor friendly policy designed to
propel India into chip fabrication, was notified.

With the notification of the policy, decks were cleared for proposed fab projects to
move forward swiftly and pull-in the required debt and equity funding. SemIndia had
been pressurizing the Union Govt. throughout 2006, for early clearance of the
Semiconductor Policy, claiming that they will not be able to tie up financing for
the Project, without clarity on the proposed incentives. However, no perceptible
activity by SemIndia was seen since the clearance of the policy.

Recent reports suggest that SemIndia is at loggerheads with Govt. of AP on various
matters including land allocation and cost of power. SemIndia has not come forward
to give their side of the story. State Govt. is understood to have invited SemIndia
for a final discussion this week-end to decide on the future of the Project.
The historic details on progress of the Fabcity Project is available at

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Contact Details =

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