Benzinga | Jun 1, 2021 01:57PM EDT

Japan Government Conceives $337M Chip Development Pact with TSMC, 20 Japanese Companies

* Taiwan Semiconductor Manufacturing Co Ltd (NYSE:TSM), along with twenty Japanese companies, have collaborated for a Japanese government-initiated chip manufacturing technology development program, Nikkei reports.

* The Japanese companies include packing technology company Ibiden, materials maker Asahi Kasei, heat-dissipating material manufacturer Shin-Etsu Chemical, material molder Nagase & Co, and manufacturing equipment producer Shibaura Mechatronics.

* TSM plans to incur 50% of the project cost of 37 billion yen ($337 million). The Japanese government will pay the other half.

* The trial facility construction will begin this summer at the National Institute of Advanced Industrial Science and Technology in Tsukuba, Ibaraki Prefecture.

* The research and development work will begin in 2022.

* TSM plans to introduce the so-called 3D packaging technology in Japan.

* Earlier this year, TSM planned to spend $178 million for a material research subsidiary near Tokyo, Reuters reports.

* There is a high chance of a Japanese TSM facility motive behind the government's cooperation.

* Price action: TSM shares traded higher by 0.95% at $118.45 in the premarket session on the last check Tuesday.