Investment in innovations and capacities

Sci­ence and tech­nol­o­gy com­pa­ny Mer­ck plans to invest sig­nif­i­cant­ly more than € 3 bil­lion in inno­va­tions and capac­i­ties of its Elec­tron­ics busi­ness sec­tor by the end of 2025. The com­pa­ny con­tin­ues to rely heav­i­ly on research and devel­op­ment (R&D) of advanced mate­r­i­al solu­tions and plans to spend more than € 2 bil­lion on long-term cap­i­tal assets.

The invest­ments are a key com­po­nent of Elec­tron­ics’ Lev­el Up growth pro­gram, which was announced at the com­pa­ny’s Cap­i­tal Mar­kets Day on Sep­tem­ber 9. With Lev­el Up, Elec­tron­ics plans to take advan­tage of the growth oppor­tu­ni­ties asso­ci­at­ed with the sig­nif­i­cant increase in glob­al demand for inno­v­a­tive semi­con­duc­tor and dis­play mate­ri­als. This demand is dri­ven by expo­nen­tial data growth and high-impact tech­nol­o­gy trends such as the Inter­net of Things and 5G. The Elec­tron­ics busi­ness sec­tor is tar­get­ing an aver­age annu­al organ­ic growth rate of 3% to 6% between 2021 and 2025. Elec­tron­ics is thus rais­ing its growth fore­cast for the sec­ond year in a row and is gear­ing up for imple­men­ta­tion and growth after a phase of transformation.

“With Lev­el Up, we are expand­ing our glob­al pro­duc­tion capac­i­ties and strength­en­ing R&D and inno­va­tion. Our high­ly attrac­tive growth mar­kets, such as semi­con­duc­tors and OLED, are cur­rent­ly con­tin­u­ing to grow at an increas­ing rate. This momen­tum allows us to sig­nif­i­cant­ly increase our growth prospects.”

- Kai Beck­mann, Mem­ber of the Exec­u­tive Board

In 2018, the divi­sion launched its “Bright Future” trans­for­ma­tion pro­gram, which was orig­i­nal­ly sched­uled to run for five years. With­in this frame­work, Elec­tron­ics repo­si­tioned itself to become a lead­ing glob­al play­er in the elec­tron­ic mate­ri­als mar­ket. “We have demon­strat­ed our imple­men­ta­tion strength in the past and com­plet­ed our trans­for­ma­tion pro­gram two years ahead of sched­ule. This has laid the foun­da­tion for an ambi­tious growth path, which we are now embark­ing on,” said Beckmann.

The new Lev­el Up growth pro­gram has four mutu­al­ly sup­port­ing core pri­or­i­ties: capac­i­ty, tech­nol­o­gy, port­fo­lio, and capa­bil­i­ties. The basis for the more ambi­tious growth tar­gets is invest­ment in these areas, com­bined with increas­ing demand for elec­tron­ic mate­ri­als, par­tic­u­lar­ly semi­con­duc­tors. The capac­i­ty and tech­nol­o­gy pri­or­i­ties are about sig­nif­i­cant capac­i­ty expan­sions in the glob­al semi­con­duc­tor and elec­tron­ics indus­try, dri­ven by large invest­ments from customers.

As a result, the Group is invest­ing in inno­va­tion and expand­ing its pro­duc­tion capac­i­ty close to cus­tomers, help­ing to address the cur­rent glob­al chip short­age. In the Port­fo­lio pri­or­i­ty, Elec­tron­ics will eval­u­ate attrac­tive exter­nal growth options through poten­tial tar­get­ed com­ple­men­tary acqui­si­tions. Lev­el Up will also launch or accel­er­ate key inter­nal ini­tia­tives under the Capa­bil­i­ties pri­or­i­ty. Among oth­er things, it will expand its data ana­lyt­ics capa­bil­i­ties, invest even more in safe­ty and fur­ther strength­en its attrac­tive­ness as an employer.

The Elec­tron­ics sec­tor sup­plies inno­v­a­tive mate­ri­als and tech­nolo­gies for the lat­est gen­er­a­tions of mem­o­ry chips and proces­sors. It also devel­ops mate­ri­als for mod­ern dis­plays and new effect pig­ments for use in the auto­mo­tive, cos­met­ics and print­ing indus­tries. Elec­tron­ics oper­ates R&D cen­ters, known as Elec­tron­ics Tech­nol­o­gy Cen­ters, at key sites in the USA, Korea, Ger­many, Tai­wan, Japan and Chi­na. With its glob­al R&D net­work, Mer­ck is an impor­tant inno­va­tion part­ner close to its customers.

Mer­ck prod­ucts are incor­po­rat­ed into almost every elec­tron­ic device. In today’s data-based world, mod­ern soci­ety needs a func­tion­ing and pow­er­ful tech­ni­cal infra­struc­ture. This brings with it ever-increas­ing tech­ni­cal require­ments, which are being cre­at­ed by growth trends such as 5G and Big Data, as well as the rapid advances in new appli­ca­tions such as autonomous dri­ving and the Inter­net of Things.

The com­pa­ny sup­plies prod­ucts for all key wafer pro­cess­ing pro­duc­tion steps: pat­tern­ing, depo­si­tion, pla­nariza­tion, etch­ing, clean­ing, dop­ing and back-end pack­ag­ing. Inter­mol­e­c­u­lar, Elec­tron­ics’ inno­va­tion hub in Sil­i­con Val­ley, tests and devel­ops advanced mate­ri­als to rev­o­lu­tion­ize next-gen­er­a­tion elec­tron­ics that make life eas­i­er, more fun and more productive.