Formosa Plastics Group is accelerating its push into higher-value products as margins in traditional bulk petrochemicals come under pressure and market conditions shift. Formosa Plastics Corp. (1301), Formosa Petrochemical Corp. (6505), Formosa Chemicals & Fibre Corp. (1303), and Formosa Biomedical Technology recently disclosed that they will jointly invest in a newly established company, Formosa Chung Hwa Advanced Chemicals Co., alongside Chung Hwa Chemical Industrial Works, Ltd. (1727), targeting the market for electronic-grade sulfuric acid used in advanced semiconductor manufacturing.
NT$6 billion capital, split evenly between the two sides
The new company will have capital of NT$6 billion and issue 600 million shares with a par value of NT$10 each. Chung Hwa Chemical will invest NT$3 billion for a 50% stake, making it the single largest shareholder. Formosa Plastics will invest NT$1.2 billion for 20%, while Formosa Petrochemical, Formosa Chemicals & Fibre, and Formosa Biomedical Technology will each invest NT$600 million for 10% apiece. Together, the four Formosa affiliates will hold the remaining 50%.
The structure keeps decision-making balanced within the joint venture. The source report said it combines Chung Hwa Chemical’s experience in producing electronic-grade sulfuric acid and validating advanced-process applications with Formosa Plastics Group’s strengths in petrochemical feedstocks, utilities, and overseas plant construction.
First-phase production is scheduled for December 2028
The companies said the first-phase plant is expected to start production in December 2028. According to a report cited from China Times News Network, the new facility will be built in two phases and will mainly produce electronic-grade sulfuric acid used in key wafer cleaning and etching processes.
As extreme ultraviolet, or EUV, scaling advances, consumption of the chemical continues to rise. The cited report said demand for electronic-grade sulfuric acid used in advanced semiconductor processes in Taiwan is expected to be clearly higher than supply capacity by 2028.
Focus on ultra-high-purity chemicals for advanced chipmaking
Formosa Chung Hwa Advanced Chemicals will focus on ultra-high-purity semiconductor chemicals including electronic-grade sulfuric acid, or EGSA, for use in advanced wafer cleaning and etching steps. As major global foundries and international manufacturers continue expanding advanced-process capacity, localized supply of high-purity electronic chemicals has become a key direction for yield control and for reducing the carbon footprint tied to ocean shipping.
The companies also said funding will be injected in batches based on the actual capital needs of the new entity. With board approvals completed and the ownership structure set, the venture is expected to move into plant construction and process validation planning.