Micron Buys Idaho Chip Fab Plant

It will be operational by the end of the year.
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Micron

(MU) - Get Report

has purchased a chip fabrication facility from

Zilog

for $5 million in cash.

Micron plans to use the Nampa, Idaho, facility to produce image sensor chips for cell-phone cameras, one of the company's fast-growing businesses at the heart of a plan to diversify from commodity DRAM memory chips.

"This acquisition allows us to move the final stages of image sensor silicon processing and other critical manufacturing steps from our Boise manufacturing operations to this new facility, which at the same time will free up space in our existing facilities and allow us to continue to meet expanding demand for our products" Micron CEO Steve Appleton said in a statement.

The 160,000-square-foot facility, which uses 8-inch wafer equipment, is expected to be operational by the end of the year. Micron said it plans to invest in facility improvements and to hire operators, technicians and support staff for the facility.

A Micron representative said the company had not determined how it would put the freed-up space in its Boise manufacturing facility to use.

The company is increasing its focus on higher-margin products like image sensors, flash memory and specialty DRAM. In Micron's most recently completed quarter, sales of such chips accounted for 45% of overall revenue. Image sensors generated $154 million in revenue during the quarter.

Earlier this month, Micron

merged its various memory groups into a single memory division, comprising its full gamut of memory products.

Micron shares closed at $16.65 Friday, down 34 cents.