Pragmatic Semiconductor opens UK's first 300mm wafer fab in Durham

Facility to bring major leap in domestic chip production amid government support

UK chipmaker Pragmatic Semiconductor has officially opened its latest manufacturing facilities in Durham, just over a year after its CEO threatened to move the company out of the country over the government's lack of support for the chip industry.

Pragmatic claims that its Pragmatic Park site at Durham, northeast England, is the UK's first production facility for producing 300mm semiconductor wafers. This will provide it with the capacity to churn out billions of the flexible chips (FlexICs) it produces every year, the company said.

Pragmatic is headquartered in Cambridge, while its first fab is located in Sedgefield, south of Durham.

The official opening of the site was attended by HRH The Princess Royal, who was given a tour of the clean room and manufacturing facilities by current CEO David Moore, followed by an unveiling of a plaque to mark the occasion. Other attendees included customers, ecosystem partners, investors, and government officials.

Pragmatic fabrication line

Pragmatic fabrication line

Moore said that the opening marks a key milestone in Pragmatic's growth, as well as for the UK on the global semiconductor stage.

"I am incredibly proud of what the team has achieved and the ambition of our mission to enable item level intelligence in over a trillion sustainable, smart items over the next decade," he said in a statement.

Smart packaging is one of the use cases for the company's flexible chips, which are made using thin-film transistor (TFT) technology and a silicon-free fabrication process. Other use cases include wearables, sensors, and flexible controllers in sectors such as consumer goods along with industrial and healthcare applications.

Pragmatic said that its new site has the capacity for up to nine fabrication lines. The company scored £182 million ($229 million) in funding at the end of last year to expand production, and said at the time that this would go towards building the third and fourth fabrication lines at Pragmatic Park.

That funding round was led by investment managers M&G and UK Infrastructure Bank, a state-owned development bank backed by HM Treasury (the finance ministry).

This rosy picture is different from a year ago, when Pragmatic was one of several UK chip startups threatening to relocate outside the country because of the government's apparent lack of support for the domestic semiconductor industry. In comparison, the US and EU authorities were promising tens of billions in funding for their chipmakers.

"It has to make economic sense for companies like ours to continue to operate and manufacture here, and if there are greater potential economic benefits and government support packages abroad, then relocation is the only sensible business decision," Pragmatic's then CEO Scott White said at the time.

That support eventually came in May last year, with the government semiconductor strategy offering £1 billion ($1.24 billion) spread over a decade for the UK's chipmakers, focused on areas seen as the country's strengths – chip design, R&D, and compound semiconductors.

This was initially criticized as too little, too late, but has since been praised by some as mostly focusing on the right areas, although greater investment would have been welcomed.

"The UK has a very supportive ecosystem for providing early stage funding, but it becomes challenging for businesses looking for later stage capital," said Niranjan Sirdeshpande, Global Head of M&G's Catalyst strategy and a Pragmatic board member.

Pragmatic said that its new site will create 500 highly skilled jobs over the next five years, as well as bolstering the UK's tech ecosystem. It also claims that its manufacturing process uses less energy and water than silicon manufacturing, and generates fewer CO2 emissions. ®

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