In today's globalized semiconductor market, the stability and diversity of the supply chain are key factors in corporate competition. On October 21, 2025, Advanced Semiconductor Engineering, Inc. (ASE) and Analog Devices, Inc. (ADI) signed a binding memorandum of understanding in Penang, Malaysia, announcing a strategic cooperation. This cooperation marks an important step for both companies in optimizing the global supply chain and enhancing manufacturing capabilities.

According to the agreement, ASE plans to acquire 100% of the shares of ADI's wholly-owned subsidiary in Penang, Analog Devices Sdn. Bhd., including its manufacturing facility in the Bayan Lepas Golden Industrial Zone. Since its establishment in 1994, the facility has been an important production base for ADI in Southeast Asia, with a construction area of over 680,000 square feet. This acquisition will enable ASE to further expand its global integrated circuit (IC) packaging and testing business network and better meet the increasingly complex customer and supply chain requirements.

Significance of the Cooperation

As the global semiconductor market continues to grow, the demand for packaging and testing services is becoming more diverse and complex. This acquisition will enable ASE to better meet customer needs and provide more comprehensive solutions. By acquiring the Penang facility, ASE will enhance its production capacity and market influence in Southeast Asia and further optimize its global supply chain layout. At the same time, the cooperation with ADI will bring advanced manufacturing technology and management experience to ASE, which will help improve its technical strength in high-end packaging and testing fields.

The sale of the Penang facility will enable ADI to concentrate resources on its core business and strategic areas, such as high-performance analog, mixed-signal, and digital signal processing technologies. In addition, by signing a long-term supply agreement with ASE, ADI will ensure the stable supply of its products and further enhance its market competitiveness with the help of ASE's manufacturing capabilities. Importantly, ADI plans to invest jointly with ASE to upgrade the technical level of the Penang facility, which will help improve production efficiency and product quality and lay a solid foundation for the long-term cooperation of both parties.

Future Outlook

ASE and ADI are expected to sign the final agreement in the fourth quarter of 2025 and plan to complete the transaction in the first half of 2026, subject to the satisfaction or waiver of the customary closing conditions agreed upon in the final transaction documents and the approval of the relevant regulatory authorities. After the transaction is completed, ASE will take over the business of the Penang facility and further develop the facility to support ADI and other customers.

This cooperation is not only an important strategic adjustment for both companies but also a vivid example of the integration and collaborative development of the global semiconductor industry. As the transaction progresses and is implemented, both parties are expected to achieve significant results in technological innovation, market expansion, and customer satisfaction improvement, injecting new momentum into the continuous development of the global semiconductor industry.

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