As reported by numerous news-sources, Silicon Integrated Systems (SiS) and United Microelectronics Corporation (UMC) settled their lawsuits in regards patent infringements earlier this week and now plan to cooperate in production capacity and fabrication process technology in future. According to some reports, UMC will also take three seats in the SiS’ board of directors.

Unofficial courses now claim that UMC also received some wafer orders from SiS this month, however, the final products will be available only in February, as the chipset designer needs to qualify the chips and perform other necessary operations so that to be sure that the core-logic devices made by its partner are quality enough. In fact I am pretty sure that there will be no problems with SiS’ chipsets made at UMC’s facilities because the manufacturing technology of both companies have very much in common since UMC already used to be the main manufacturing partner of SiS until late 2000, when the Hsinchu-based chipset designer launched their own fab, practically copying the fabrication technology of UMC.

In fact, the partnership between UMC and SiS seems to be a promising one. SiS constantly cannot fulfil the demand on their products, but has a lot of favourable business opportunities, for instance, Quad Pumped Bus license from Intel and high demand on graphics processors and integrated core-logic products in China. UMC is able to make a lot of semiconductors, however, they do not have so much orders. As a result, their manufacturing capacities are abused presently.

Dow Jones Business News reports that UMC acquired 2.32% stake in SiS on open-market recently. UMC claims that it will further invest in SiS due to new business circumstances. SiS plans to order 0.15 and 0.18 micron chips to UMC at first. Other details about cooperation are unknown.