Samsung Electro-Mechanics to invest $5 billion in chip substrate production — Korea Herald
South Korea’s Samsung Electro-Mechanics plans to invest about $5 billion in expanding the production of chip package substrates in South Korea and Vietnam. Part of the capital expenditures for new AI server substrate capacity in Sejong will be financed by global customers, which have also committed to purchasing the products in the medium and long term, Korea Herald reports.
Investments in Sejong
The Samsung Group affiliate will invest 4.27 trillion won, or $3.2 billion, in its plant in Sejong by May 2028. The funds will be used to increase production of FC-BGA, or flip chip-ball grid array substrates, which are used in artificial intelligence accelerators and other high-performance chips.
Mass production at the new facilities is scheduled for September 2028. This is Samsung Electro-Mechanics’ largest investment in a single product: it amounts to 43.6% of the company’s consolidated equity as of the end of 2025.
The company did not name the customers involved in the financing or disclose the size of their contribution. At the same time, local media, citing several industry representatives, reported advance payments worth trillions of won from Nvidia and other major technology companies. Samsung Electro-Mechanics did not confirm these details.
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Expansion in Vietnam
Separately, Samsung Electro-Mechanics’ Vietnamese subsidiary will invest 2.51 trillion won by April 2028 to expand a plant producing chip package substrates. The submitted documents did not specify either the type of products or the customers of this facility.
In March, the company’s CEO Jang Deok-hyun said that customer demand for FC-BGA for servers and data centers exceeded Samsung Electro-Mechanics’ production capacity by more than 50%. In July, the company also announced a broader plan to invest about 8 trillion won in its Sejong site by 2040.
Since May, the manufacturer has reported long-term contracts to supply silicon capacitors and multilayer ceramic capacitors for AI servers with a total value of 3.32 trillion won. These include a 1.1 trillion won contract announced on September 1, with deliveries scheduled for 2027.
