Tower Announce Plans to Expand in Japan
To ensure continuity, both companies will enter into long-term reciprocal supply agreements.
Tower Semiconductor has announced a major restructuring of its operations in Japan, marking a shift in how its joint venture with Nuvoton Technology Corporation is organised. The move will see Tower assume full ownership of its 300mm fabrication facility (Fab 7), while Nuvoton’s Japanese subsidiary (NTCJ) will take full control of the 200mm facility (Fab 5).
The changes relate to TPSCo, the existing joint venture in which Tower currently holds a 51% stake. Under the new structure, Fab 7 will be transferred to a wholly owned Tower subsidiary in Japan, including all associated production tools, operations, employees and business activities. At the same time, NTCJ will assume full ownership of Fab 5.
To ensure continuity, both companies will enter into long-term reciprocal supply agreements. This means customers on either side will see no disruption, with Tower continuing to support those served by the 200mm facility and Nuvoton maintaining supply from the 300mm fab.
The transaction is expected to close on 1 April 2027, subject to regulatory approvals and standard closing conditions.
Tower also plans to expand its 300mm capacity significantly. It holds an option to acquire the Fab 7 site, along with adjacent land to support future development. Pending approval for government subsidies from Japan’s Ministry of Economy, Trade and Industry (METI), the company aims to scale production capacity at its Uozu site to four times its current level.
A key driver behind this expansion is Tower’s growing photonics business. With technologies already qualified and in volume production at Fab 7, the company expects a faster ramp-up compared to typical semiconductor expansions. Additional output is projected to come online as new equipment is installed, allowing growth without the long lead times and high initial costs associated with greenfield developments.
Chief executive Russell Ellwanger said the restructuring builds on a long-standing partnership with Panasonic and Nuvoton, while enabling a new phase of collaboration based on supply agreements rather than joint ownership. He noted that the move will strengthen Tower’s position in optical and photonics technologies and support long-term growth.
The company also highlighted its intention to work closely with Japanese authorities to advance innovation and reinforce the country’s semiconductor ecosystem, positioning the expanded facility as a key part of its global manufacturing strategy.
Project News