World’s first compound semiconductor cluster comes to south-east Wales

World’s first compound semiconductor cluster comes to south-east Wales

An historic signing ceremony will take place later today to ratify the development of a compound semiconductor industry cluster in south east Wales.

The signing follows an agreement made in May by the Cardiff Capital Region (CCR) Regional Cabinet to contribute £37.9 million from the CCR City Deal’s Wider Investment Fund towards the establishment of a major, cutting edge facility, as an anchor in the region for high-end production of compound semiconductors.

The aim is to support the development of a compound semiconductor industrial cluster in the region, with the potential to leverage £375m of private sector investment, create up to 2,000 skilled jobs, return the initial investment for use in other schemes, and create hundreds of other jobs throughout the supply chain.

It is the first such investment since the £1.2 billion CCR City Deal programme was formally signed by the leaders of the ten local authorities in the region on March 1.

The facility in Newport will be owned by the 10 Councils in the Regional Cabinet under the special purpose vehicle ‘CSC Foundry Limited’ / ‘LDC Ffowndri’ and the space leased to IQE plc for compound semiconductor manufacturing and applications development.

The project is not a grant or a loan, it is a commercial investment with ownership of the foundry shared between the 10 Councils.

The aim of the proposal is to return the original investment plus interest over the life of the project.

The project will be formally confirmed in a signing ceremony today at IQE’s headquarters in Cardiff by Secretary of State for Wales, Alun Cairns MP, Welsh Economy and Infrastructure Secretary Ken Skates, CSC Foundry Directors Councillors Bob Greenland (Monmouthshire) and Andrew Barry (Merthyr), and IQE chief executive Dr. Drew Nelson.

The CCR City Deal seeks to position the region as the global leader in compound semiconductor-enabled applications, which was initiated by a £12 million investment from the Welsh Government.

In 2016, Innovate UK – the UK Government’s innovation agency – announced a £50million investment to establish a new Compound Semiconductor Applications Catapult in South-East Wales.

This new Catapult will build on existing investment by Cardiff University, IQE, and Welsh Government.

Councillor Peter Fox, Leader of Monmouthshire County Council, and Deputy Chair of the CCR City Deal Regional Cabinet, said: “The objective of this commitment is to create a complete compound semiconductor eco-system in South Wales to take advantage of the growing prominence of compound semiconductor technologies.

“The opportunity this investment creates, to help the establishment of the world’s first compound semiconductor cluster in South East Wales, should not be underestimated

“It has the potential to place our region at the heart of this cutting edge sector and will require the development and integration of a compound semiconductor supply chain in South Wales, with the economic and social benefits that will bring.

Secretary of State for Wales Alun Cairns said: “Compound semiconductors are at the heart of many devices we use today, from smart phones to tablets and satellite communication systems.

“It is an area of UK strength and today’s confirmation of the development of a cluster of excellence in Wales reinforces our own strong position in the growth of this important and growing technology.

“Of course, government does not create innovation, but it can be a catalyst to getting the scientists and engineers, the designers and the entrepreneurs together to make it happen.

“This collaboration is important because innovation is a shared endeavour and I look forward to seeing the cluster take shape and create a lasting engineering and manufacturing legacy in Wales.”

The signing will take place at IQE plc, St Mellons, at 11.30am later today (Monday 11th September)

The Compound Semiconductor Cluster will bring together next-generation semiconductor materials with end-user applications such as 5G smart phones, the Internet of Things, tele-health and autonomous vehicles

Compound semiconductors are more complex than silicon technology and offer lower power consumption, higher operating speeds and temperatures, light-emitting and detecting properties.