Compound Semiconductors

The Foundry

Status: Delivery

Establishing a major, cutting edge new compound semiconductor mega foundry situated between Newport and Cardiff, as a regional anchor for high- end production of compound semiconductors.

What is the project about?

The CSC project involves an agreement between the CCRCD and IQE plc, a large commercial manufacturer of semiconductor wafers, based in South-East Wales.

The CCR Regional Cabinet agreed in 2017 to purchase a factory building at Imperial Park in Newport and invest £37.9M, alongside IQE, towards the establishment of a major, cutting edge new compound semiconductor mega foundry situated between Newport and Cardiff, as an anchor in the region for high end production of compound semiconductors. The investment is expected to complement other investments in the compound semiconductor sector locally, including ERDF funding for Cardiff University’s Institute for Compound Semiconductors.

The project aims to secure substantial commercial investment in manufacturing and development and to support the development of a wider ‘cluster’ of compound semiconductor activity in South Wales, linked with academic expertise at Cardiff University and a concentration of related companies in the supply chain.

The long-term intention is to secure substantial commercial investment in manufacturing and development and to support the development of a wider compound semiconductor activity in South Wales, and in so doing create a cluster at the forefront of R&D in this technology area, and at the forefront of production of compound semiconductors.

It is anticipated that the investment will help:

lever £375m of private sector investment,
create up to 2,000 high skilled jobs,
create hundreds more jobs in the wider supply chain cluster

The facility at Newport is owned by the 10 Councils in the Regional Cabinet under a special purpose vehicle (SPV) ‘CSC Foundry Limited’ and the space is leased to IQE plc for compound semiconductor manufacturing and applications development. The SPV will receive rental income for 11 years at which point IQE has an option to acquire the site. Through this arrangement, the expectation is that the Investment Fund monies would be repaid and made available for usage on other regional schemes.

What are Compound Semiconductors?

Semiconductors in the form of both silicon and compound semiconductors, form the heart of many of today’s technologies. Without semiconductors, many devices and applications that we rely on simply would not exist, yet these atomically engineered materials go largely unnoticed amongst the end user brands with which we are so familiar.

Semiconductors are a key enabling technology that feed into multiple supply chains feeding a wide range of market sectors including: aerospace, healthcare technologies, aerospace, safety & security, big data and the Internet of Things (IoT), energy efficiency (generation and consumption), robotics and automotive products.

Impressive as the impact of silicon has been on our lives, it has a very basic and limited set of properties that restricts its application in many new and emerging technology areas that demand ultra-high performance levels along with sensing and other capabilities.

By atomically engineering crystal structures that combine elements either side of those in group IV of the periodic table (e.g. groups III and V), a set of new semiconductor materials has emerged whose enhanced properties offer significant performance improvements over those of silicon alone.

These compound semiconductors enable high speed processing in excess of 100 times that of silicon, as well as an array of other properties including the ability to emit and sense light, all the way from the infrared, through the visible and into the ultra-violet part of the spectrum.

It is our ability to harness the advanced properties of the full range of semiconducting materials that will drive the digital revolution for generations to come.

Investment and leverage

£38.55m

CCR Investment

£6m

Match Funding

£375m

Projected Leverage

Expected benefits and outcomes

By the end of April 2020, 70 additional jobs had been directly created at the site as a result of investment in the foundry. 95% of these jobs are for people living within the CCRCD region.
545 jobs have been safeguarded as a result of the investment.
- 156 at IQE, within its existing operations at St Mellons in Cardiff.
- 389 jobs safeguarded at Newport Wafer Fab, a privately-owned silicon wafer fabrication plant located about a mile from the Imperial Park site.
- 8 new apprenticeship opportunities had been created during the construction phase of the project.
Local innovation ecosystems have been enhanced.
There has been an Increase in the number of businesses that are innovation active (i.e. in the wider compound semi-conductor sector).
The UK Government has awarded £25.4m in funding towards a £43.7M CSconnected project within the Compound Semiconductor Cluster. CS Connected has attracted Cluster related projects to the value of £124M with a further £56M of projects in the pipeline. For more information on CSconnected click here: https://csconnected.com/
CSCatapult has moved into the Foundry. CSCatapult are focussed on helping UK industry exploit advances in compound semi-conductor technologies and bringing applications to life.
For more information on CSCatapult click here: https://csa.catapult.org.uk/

Key partners and people involved

Who is involved?

The project involves an agreement between the CCRCD and IQE plc.

IQE is the global leader in the design, manufacture and supply of advanced semiconductor wafer products and services. Their vision is to maintain and grow their established position as the “go to” compound semiconductor specialist.

For more info on IQE click here.

Foundry Board

To deliver the project, the CCR Regional Cabinet established a special purpose vehicle (CSC Foundry Ltd) to acquire the building, manage the lease and support the delivery of the CSC Project. The Board of Directors are responsible for ensuring the project complies with the legal framework created by the Shareholder Agreement and associated legal agreements.

The CSC Foundry board will act as the driver to ensure the CSC project delivers its planned outputs and where possible within the scope of the project work to support its intended outcomes:-

The regular duties of the board are to:

Monitor the timely delivery of the CSC Project against agreed milestones
Identify, monitor and support the resolution of risks and issues
Sponsor and support Project assurance reviews, approving and/or ensuring improvement actions where required
Authorise key documentation – annual business plans, annual budgets, update reports, finance reports and requests for funding drawdown