ASE responds to KEPB's order to suspend work at K7 plant's wafer-level process that requires wastewater treatment ASE is proactively taking steps to resume operations quickly and ensure minimal disruption to customers as well as preserve the employment rights of our employees
TAIPEI, Taiwan, R.O.C., Dec. 20, 2013 /PRNewswire/ -- Advanced Semiconductor Engineering, Inc (TAIEX: 2311, NYSE: ASX), the world's largest semiconductor assembly and test service provider, today issued the following statement in response to the Kaohsiung Environmental Protection Bureau (KEPB)'s press announcement regarding its order to suspend work at ASE K7 plant's wafer-level process that requires wastewater treatment ("suspension order"). As of the time this press release, ASE has not received the official notification from the KEPB.
ASE deeply regrets the KEPB's decision. Despite the obstacles posed by this order, ASE will take concerted steps to promptly implement corrective actions in areas that require improvement. It is our objective to swiftly complete the improvements and apply to the bureau to resume normal production at K7 and minimize the impact to our operations. In parallel, ASE will appoint our legal advisers to examine the KEPB's decision and seek redress by legal means.
K7 has a production capacity of approximately USD58 million per month and its revenue is about 9% of the ASE Group's total consolidated revenues. Approximately USD40 million of our capacity belong to non-wafer level processes. The suspension order will only affect our wafer-level process capacity and may result in a monthly impact of USD18 million.
ASE has mobilized all its resources to ensure minimal impact to our customers, and we believe that the situation, though challenging, is under control. ASE will begin communications with those customers affected to set up contingency plans. Our relationships with customers have been built steadily over the years and remain strong, despite this situation.
K7 employs about 5,000 people who are mainly skilled workers and are the most valued resources of the company. We aim to resume normal operations at K7 plant's wafer-level process as soon as practicable. During the work suspension period, we will continue to pay our employees according to prevailing labor laws to preserve our employees' labor rights.
ASE will expedite the completion of a NTD750 million water recycling plant at ASE Kaohsiung's K14. This will be Taiwan's first 20,000 ton per day water recycling plant that will apply the highest standards of water recycling technologies. The water recycling plant is scheduled to begin operations in the second quarter of 2014.
Going forward, ASE remains committed to environmental protection issues, and continues to invest in this endeavor. ASE will contribute at least NTD100 million annually, for the next 30 years to Taiwan's environmental protection efforts, fulfilling our duties as a socially responsible corporate citizen.
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SOURCE Advanced Semiconductor Engineering, Inc.