Micron completes $1.8 billion Tongluo P5 chip facility acquisition in Taiwan
Micron Technology closes its purchase of Powerchip's Tongluo semiconductor site in Taiwan and announces plans for a second facility, as the U.S. memory chipmaker accelerates AI memory chip production.
U.S. memory chipmaker Micron Technology formally announced on March 15, 2026 that it has completed the acquisition of Powerchip Semiconductor Manufacturing Corporation’s (PSMC) P5 site in Tongluo, Miaoli County, Taiwan. The transaction was carried out under an acquisition agreement first announced on January 17, 2026.
According to Micron’s official press release, the new site will complement Micron’s existing operations as an extension of the company’s vertically integrated mega campus in Taichung, located approximately 15 miles away.
The acquisition strengthens Micron’s ability to increase DRAM and AI memory chip production as demand for artificial intelligence infrastructure accelerates.
Micron Powerchip Acquisition: Deal Terms and Timeline
According to Micron’s investor relations official announcement, the acquisition secures approximately 300,000 square feet of 300mm cleanroom space, with retrofitting already underway following the initial January deal.
Reuters reported on Monday that Micron plans to build a second manufacturing facility at the Tongluo site of similar scale to the existing fab, with construction scheduled to begin by the end of fiscal 2026, adding approximately 270,000 square feet of additional cleanroom space.Meaningful product shipments from the existing fab are expected to begin in fiscal 2028, Micron confirmed.
Additionally, the company has acknowledged support from Taiwan’s Ministry of Economic Affairs, National Science and Technology Council, Hsinchu Science Park, and Miaoli County Government in completing the transaction.
This deal traces back to January 2026, when Bloomberg first reported that Micron had signed a letter of intent to acquire a fabrication site in Taiwan from PSMC for $1.8 billion, with plans to ramp DRAM production in phases after closing.
AI Memory Chip Production Drives Taiwan Expansion
The Micron Tongluo P5 acquisition is part of a broader and accelerating global capital program. Just ten days after the Tongluo letter of intent was signed, CNBC reported that Micron committed approximately $24 billion to expand wafer manufacturing in Singapore.
This investment adds 700,000 square feet of cleanroom space at an existing NAND manufacturing complex, with production expected to start in the second half of 2028.
The Digitimes reportnoted that the pivot by Micron and other memory makers to prioritise high-bandwidth memory (HBM) production has contributed to shortages of other types of memory chips, with some estimates forecasting those shortfalls could last through late 2027.
The acquisition strengthens Micron’s manufacturing footprint in Taiwan, a territory already home to Taiwan Semiconductor Manufacturing Company and other critical nodes in global supply chain management for the semiconductor industry.
Micron Leadership and Investor Market Response
In Micron’s official press release, Manish Bhatia, Executive Vice President of Global Operations, stated: “The Tongluo facility complements our Taiwan operations and is a critical component of our global expansion plans.
Memory is a strategic asset that dictates AI product performance, and the acquisition and phased ramp of this site strengthens our ability to capitalise on these significant opportunities.”
On the market side, reported that Micron shares climbed roughly 20% over the prior 30 days, reflecting sustained investor confidence in the company’s AI memory growth strategy and Taiwan semiconductor expansion.
Separately, Markets.BusinessInsider.com reported that the Tongluo P5 closure marks a key logistical milestone in Micron’s global capacity buildout, with the brownfield acquisition accelerating its Taiwan DRAM production timeline over a greenfield investment.
Micron Taiwan Facility Impacts AI Ecosystem
The completion of the Micron Taiwan semiconductor facility acquisition carries direct implications for the global AI memory chip supply chain. As Taiwan News reported, the new facility will help Micron expand the supply of leading-edge DRAM products, including high-bandwidth memory, to support surging AI demand.
Investing.com reported that the acquisition strengthens Micron’s position in the semiconductor industry, with the company commanding a market capitalization of $479.6 billion.
For AI data center operators and cloud providers, this brownfield site allows new HBM and DRAM capacity to come online significantly faster than a new build. This phased ramp provides a critical advantage for GPU-accelerated workloads, especially given the ongoing industry-wide memory supply constraints.
Micron DRAM Production: The Competition Ahead
Micron will proceed with immediate cleanroom retrofitting at the Tongluo P5 site, with construction of a second comparable facility at the same campus scheduled to begin before the close of fiscal 2026. Meaningful product shipments from the existing Tongluo fab are targeted for fiscal 2028, per the company’s official press release.
Industry observers will be watching whether the combined output of Micron’s Taiwan and Singapore expansions enables Micron to close the competitive gap with South Korean rivals Samsung Electronics and SK Hynix, which currently dominate HBM memory chip production for AI GPU platforms.
Source: Micron Completes Acquisition of PSMC’s Tongluo P5 Site in Taiwan
