Samsung’s Lee expected to visit ASML this month for chip equipment procurement

SEOUL-- Samsung Electronics Vice Chairman Lee Jae-yong will leave for the Netherlands next week, in a business trip widely expected to secure highly advanced chipmaking machines by the Dutch chip equipment maker ASML.

On Thursday, Lee asked for permission to be absent from his ongoing trial at the Seoul Central District Court over the controversial merger between two Samsung affiliates, a deal seen as a scheme to consolidate his leadership at the country's biggest chaebol.

The court said Lee will not be able to attend two trial sessions, set for next Friday and June 16, due to his trip to the Netherlands from June 7-18.

Lee is highly likely to visit Veldhoven-based ASML, one of Samsung's biggest chipmaking partners and the sole maker of extreme ultraviolet (EUV) lithography systems.

Samsung and ASML both declined to comment on Lee's itinerary.

Lee's overseas trip came 10 days after the South Korean tech giant announced a massive investment plan for the next five years to sharpen its competitiveness in the chip industry.

Samsung said it will invest 450 trillion won (US$355 billion) in semiconductor and biopharmaceuticals in the span of five years, 80 percent of which will be used for research and development and nurturing talent in South Korea, especially in advanced chipmaking.

In particular, the company said it will import the EUV machines at an earliest date, which it said "will give Samsung an advantage to make most advanced microchips."

Samsung has said it will continue to beef up its chip business "by expanding supply of high-performance products and increasing application of its industry-leading EUV technology."

In October, the company begun mass producing the industry's smallest, 14-nanometer (nm) DRAM memory based on multilayer EUV technology, considered essential to improve patterning accuracy for higher performance, greater yields and lower power consumption.

Samsung is the world's largest memory chip maker and second-largest contract chip manufacturer.

Global chipmakers, including Samsung, Intel, SK hynix and TSMC, are competing against each other to secure the Dutch company's $150 million EUV machines, which are in short supply over surging demand for high-end chips used in internet of things, servers and artificial intelligence, among others.

"Demand significantly exceeds our capacity," ASML CEO Peter Wennink said in January after the company announced its fourth-quarter earnings results.

"It's unprecedented. I have never seen this before," he added.

Meanwhile, ASML is expanding its operations in Korea, one of the company's largest markets, amid the continued chip shortage.

Wennink visited South Korea in April for a chip cluster project and meetings with local employees.

In November, ASML signed a memorandum of understanding with the city of Hwaseong to invest 240 billion won (US$212 million) in building a 16,000-square-meter chip cluster there by 2024. The facilities will include an office that can house up to 1,500 employees, training and repair centers for EUV machines.

South Korea is ASML's key market that represented 33.4 percent of its 2021 total net sales, according to the company. It was 29.7 percent the previous year.

The company started operations in South Korea in 1996, with global distribution, support and training centers located in four cities -- Cheongju, South Chungcheong Province, Hwaseong, Pyeongtaek and Icheon, all in Gyeonggi Province. It has more than 1,400 local employees, with 70 percent of them young millennials, the company said.

In October 2020, Samsung's de facto leader Lee visited the headquarters of ASML to discuss supply plans of EUV equipment, cooperation in advanced semiconductor manufacturing technology and the industry outlook amid the COVID-19 pandemic.

Source: Yonhap News Agency