Mitel Semiconducter Case
Management 642
Mitel Semiconductors
Ivey Business Case Nick Weller, Brin Conner, Joshua Goldsmith, Brian Gregory 2/14/2012
1
Mitel Semiconductors Mitel Semiconductors is a division of Mitel Corporation. The semiconductors division focuses on the business communications segment of the overall semiconductor market. The segment is relatively small when compared to the semiconductor market as a whole but the segment is experiencing high levels of growth over the next five years. Currently Mitel Semiconductors holds 7% of the business communications segment and management would like to see market share double in the next five to six years. Mitel Semiconductors is quickly approaching full capacity at its Bromont Foundry that performs the entire FAB portion of the integrated circuit manufacturing process. In order to meet management’s goal of doubling market share over the next five to six years, Mitel Semiconductors needs to figure out a way to dramatically increase production to keep pace with demand. Since traditionally, Mitel Semiconductors is risk adverse management needs a creative solution that can be implemented using only the current amounts of cash and cash equivalents on hand. Mitel Semiconductors can increase capacity in three distinct ways. First, it can build or acquire a new foundry that can be brought online to produce more wafers for the integrated circuits. This would obviously cost the company a lot of money. It will also take considerable amount of time to get a new foundry up and running. There are however, a few alternatives that require less capital outlay and can be implemented in a matter of months. The next way Mitel Semiconductors can increase its capacity is to change their wafer size from 100mm to 150mm, 200mm, or 300mm. The increased size of the wafer can increase capacity from the increase in surface area. Each wafer would still require the same amount of processing time but could now produce more integrated
2
circuits per wafer due
Mitel Semiconductors
Ivey Business Case Nick Weller, Brin Conner, Joshua Goldsmith, Brian Gregory 2/14/2012
1
Mitel Semiconductors Mitel Semiconductors is a division of Mitel Corporation. The semiconductors division focuses on the business communications segment of the overall semiconductor market. The segment is relatively small when compared to the semiconductor market as a whole but the segment is experiencing high levels of growth over the next five years. Currently Mitel Semiconductors holds 7% of the business communications segment and management would like to see market share double in the next five to six years. Mitel Semiconductors is quickly approaching full capacity at its Bromont Foundry that performs the entire FAB portion of the integrated circuit manufacturing process. In order to meet management’s goal of doubling market share over the next five to six years, Mitel Semiconductors needs to figure out a way to dramatically increase production to keep pace with demand. Since traditionally, Mitel Semiconductors is risk adverse management needs a creative solution that can be implemented using only the current amounts of cash and cash equivalents on hand. Mitel Semiconductors can increase capacity in three distinct ways. First, it can build or acquire a new foundry that can be brought online to produce more wafers for the integrated circuits. This would obviously cost the company a lot of money. It will also take considerable amount of time to get a new foundry up and running. There are however, a few alternatives that require less capital outlay and can be implemented in a matter of months. The next way Mitel Semiconductors can increase its capacity is to change their wafer size from 100mm to 150mm, 200mm, or 300mm. The increased size of the wafer can increase capacity from the increase in surface area. Each wafer would still require the same amount of processing time but could now produce more integrated
2
circuits per wafer due