ASE’s Penang Acquisition Signals Major Expansion in Manufacturing Capabilities

ASE Technology Holding Co. (NYSE: ASX) is set to significantly broaden its manufacturing scale and global reach with a definitive move to acquire Analog Devices’ (NASDAQ: ADI) facility in Penang, Malaysia. This landmark step not only strengthens ASE’s global footprint but also solidifies a long-term partnership with ADI through a new supply agreement and planned co-investment in manufacturing upgrades.

Key Details: Collaboration and Facility Acquisition to Reinforce Global Resilience

Announced via a joint press release, ASE’s purchase includes 100% of Analog Devices Sdn. Bhd.—granting full control of the 680,000-square-foot Penang facility established in 1994. Pending regulatory and customary closing conditions, the acquisition is expected to finalize in the first half of 2026, with definitive agreements set for Q4 2025.

Long-Term Supply Agreement Strengthens Global Operations

As part of the deal, ASE and ADI have outlined a long-term supply contract that secures manufacturing services for ADI while guaranteeing robust utilization for ASE’s expanded capabilities. Additionally, both companies will co-invest to upskill and enhance the Penang facility, aiming to boost technological prowess and provide new opportunities for the local workforce.

Strategic Rationale: Enhanced Flexibility and Operational Scale

This move offers both companies a pathway to increased operational flexibility and improved resilience across their supply chains—a vital concern amid recent industry disruptions. By integrating the Penang site into its global network, ASE aims to support increasingly complex customer requirements, streamline logistics, and accelerate innovation in IC packaging and testing solutions.

Executive Perspectives Emphasize Growth and Supply Chain Security

ASE’s COO, Tien Wu, described the acquisition as a calculated step toward broader capabilities and deeper collaboration, anticipating “future growth and innovation” as a result. Analog Devices’ EVP of Global Operations, Vivek Jain, echoed this view, underlining how the collaboration will strengthen both technology offerings and supply chain resiliency for their respective customers and stakeholders.

Timeline: Key Dates for Investors and Industry Watchers

Takeaway: Significant Expansion Positions ASE for Continued Industry Leadership

This transaction underscores a commitment by both ASE and ADI to lead the next phase of global semiconductor manufacturing through operational flexibility, strategic investment, and collaborative innovation. Investors and industry participants may want to follow further developments closely, as this deal could shape future industry dynamics, workforce development, and technology transfer in the semiconductor sector.

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