Microchip Announces Sale of Wafer Fab

Today, Microchip Technology Inc. has announced that it has engaged Macquarie Group to oversee the marketing and sale of its Fab 2 wafer manufacturing facility in Tempe, Arizona. This decision aligns with Microchip's previously disclosed manufacturing restructuring strategy, aimed at improving operational efficiency and profitability.

Fab 2, which houses fully operational semiconductor equipment, will be marketed and sold under the guidance of Macquarie’s semiconductor and technology team within its Commodities and Global Markets division. As part of this transition, Microchip will relocate manufacturing operations and technology from Fab 2 to its Fab 4 and Fab 5 facilities in Oregon and Colorado, respectively. These sites remain integral to the company's long-term production and capacity plans.

Michael Finley, Senior Vice President of Wafer Fab Operations at Microchip, stated, “The closure and sale of Fab 2 mark the latest milestone in our ongoing restructuring efforts to optimize our manufacturing footprint. Macquarie has extensive experience in asset marketing and disposition, from advanced equipment sales to full facility transactions, making them well-suited to oversee the sale of the wafer fab.”

Don Trent, Senior Managing Director at Macquarie's Commodities and Global Markets division, added, “Macquarie provides asset-focused solutions essential to semiconductor manufacturing, from equipment remarketing to wafer fab sales. Having completed over 50 wafer fab disposition projects, we are pleased to assist Microchip in the sale of its Tempe facility.”

Earlier in March, Microchip announced additional restructuring measures aimed at reducing costs and optimizing its manufacturing scale. The restructuring is expected to result in a workforce reduction of approximately 2,000 employees and associated costs ranging from $30 million to $40 million. The company plans to notify employees during the fiscal quarter ending March 2025, with full implementation expected by the end of June 2025. Once fully executed, these measures are projected to lower annual operating expenses by approximately $90 million to $100 million.