Samsung Likely to Spin off Foundry Business Division

According to Business Korea Samsung Electronics is considering a reorganization of the System LSI division in order to systematically grow the system semiconductor business. The company is planning to separate the design and manufacturing sectors in the business unit and divide or spin off it to fabless and foundry business divisions.

The consideration came after the company lost Apple, the largest customer in the sector of application processors (AP), which refers to the brain of smartphones, to Taiwan’s TSMC and some raised awareness towards the need to separate the foundry business division.

Samsung Electronics’ System LSI business division is largely divided into four segments; system on chip (SoC) team which develops mobile APs, LSI development team which designs display driver chips and camera sensors, foundry business team and support team. According to many officials in the industry, Samsung Electronics is now considering forming the fabless division by uniting the SoC and LSI development teams and separating from the foundry business.

The System LSI reorganization plan shows Samsung’s will to grow the business more systematically by dividing its system semiconductor design and manufacturing capabilities.

As Samsung Electronics succeeded in mass producing system semiconductor products 10-nanometer process technology for the first time in the world, the company signed a large foundry contract with Qualcomm.