Hynix seeks land for new chip plant in Cheongju

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Hynix seeks land for new chip plant in Cheongju

Hynix Semiconductor wants to build a new plant in Cheongju, North Chungcheong province, but whether it can secure the land designated for the site is still a question mark.
On Jan. 24 the government rejected Hynix’s plan to expand its main semiconductor plant in Icheon, 80 kilometers (50 miles) south of Seoul, citing environmental concerns.
Instead, the Korean government recommended that Hynix build a plant in Cheongju, 137 kilometers south of Seoul.
The site that Hynix is eyeing is the former site of Samik’s plant, located in the Cheongju Industrial Complex.
If Hynix is able to buy the land this month, it will begin first-phase construction in March, the company said yesterday.
The chipmaker has already sent an official notice to Samik’s trustee in bankruptcy, asking to be notified if it will sell the land, and if so, how much it would cost, and when it would be able to receive the deed.
Hynix asked the trustee in bankruptcy to provide an answer by Wednesday.
The complex problem regarding the land is that it has already gone into auction procedures by Samik’s 12 creditor groups.
Land owned by companies that have gone bankrupt must go through a normal competitive bidding process.
If the bidding produces no result, then creditors are allowed to sell the land through private deals.
If legal procedures take place as originally planned for the sale of Samik’s land, the first auction could take place as early as May.
“Cheongju is our first choice, similar to a preferred negotiator if this were a sale of the company,” a Hynix spokesperson said.
“You could say we’ve selected them as the preferred negotiator, and we’ve begun negotiating.
“It is urgent for us to begin construction of the plant as soon as possible,” the spokesperson said.
“If the purchase of the lot does not go smoothly, we have no choice but to hurriedly seek another site.”
Private contracts, however, could produce criticism that Hynix received special benefits, and creditors of Samik are also mixed in their opinions.
The Cheongju city office, in hopes of attracting Hynix there, suggested that it buy the lot and then rent the land to Hynix at a low price.
But that transaction could be viewed by the World Trade Organization as a form of illegal subsidies.


By Kim Chang-woo JoongAng Ilbo [wohn@joongang.co.kr]
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