[Exclusive] SK Siltron Implements Partial Process Outsourcing... Organizational Restructuring as 'Pre-Sale Maneuver'

Outsourcing of 200mm Initial Processing Amid Rising Chinese Competition
Over 5% of Total Workforce to Be Reassigned to Other Departments and Processes
"Strong Indications of Pre-Sale Restructuring"

It has been confirmed that SK Siltron is shifting part of its initial semiconductor wafer processing lines to an external outsourcing model and is preparing to reassign up to 200 employees from those lines to other processes. The company explains this as a preemptive measure to strengthen its management competitiveness, but some interpret it as part of a restructuring effort to expedite a sale.

Exterior view of the SK Siltron building located in Gumi, Gyeongbuk. Provided by SK Siltron

According to industry sources on June 25, SK Siltron recently decided to outsource part of the initial process for its 200mm wafer line at its Gumi Plant 2 in Gyeongbuk, and is preparing to reassign 197 production workers to other departments or processes. Given that the total number of employees at the headquarters office and Gumi Plants 1 to 3 is about 3,600, this represents more than 5% of the workforce.

The prevailing interpretation is that SK Siltron's decision to outsource is a move to accelerate the sale of its management rights. The 200mm products subject to outsourcing have lost price competitiveness due to cheaper Chinese imports. Internally, there have been ongoing calls to focus on the higher value-added 300mm line and to overhaul outdated processes. Reducing labor costs could also ease the burden of a sale. According to the investment banking industry, a group of potential buyers, mainly private equity funds (PEFs), is currently conducting preliminary due diligence on SK Siltron. The shortlist of qualified preliminary bidders is expected to be selected as early as the end of this month.

However, the company maintains that this is one of several measures to strengthen business competitiveness and is not directly related to a group-level sale. A company representative explained, "Ahead of the operation of the new plant, we are aiming to operate more efficiently by reallocating existing personnel rather than hiring externally."

Some within the company are concerned that the outsourcing initiative could expand to other processes. An employee who requested anonymity said, "If additional outsourcing occurs and there are no available positions in the 300mm process, existing employees could face job insecurity, which is a significant concern."

Lee Junseo, a professor in the Department of Business Administration at Dongguk University, commented, "Outsourcing processes that have lost price competitiveness against China can be seen as part of a selection and concentration strategy. If outsourcing is being pursued after the start of sale discussions, it can be interpreted as a strategic step to enhance corporate value."