TSMC’s manufacturer of storage tanks is hidden jewel of Japan’s chip industry | Takashi Mochizuki & Yuki Furukawa / Bloomberg News

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The world’s most advanced and delicately fine-tuned semiconductors wouldn’t be possible without the aid of giant steel storage tanks built by a little-known Tokyo company founded in 1927.

Valqua Ltd. makes specialized, super clean containers for storing essential chipmaking chemicals, and it expects to hit its highest sales ever this fiscal year. It’s by far the world’s largest supplier of such tanks, dwarfing a clutch of smaller competitors in places like Taiwan, and providing almost every tank used by the world’s biggest contract chipmaker, Taiwan Semiconductor Manufacturing Co., according to Ichiyoshi Research Institute analyst Mitsuhiro Osawa.

Valqua gets more than half its sales from semiconductor makers and its close-knit relationship with the chip sector helps it stand out among industry peers. At $470 million, it’s Japan’s most valuable supplier of mechanical rubber products after doubling its share price over the past three years, from just before the pandemic.

The various chemicals and acids used in semiconductor fabrication processes have to be free of contaminants. The required purity for the ones used in cleaning wafers is equivalent to taking a trip around the Earth without finding a dust speck wider than a tenth of a human hair. Those extreme specifications make it a tough business for a small company to enter and an unattractive one for bigger players, according to Hombo.

Valqua may spend to accelerate its growth push as it moves toward its hundredth birthday. “Our balance sheet is healthy right now, and we may eye some acquisitions and expansions,” the company’s president said.

 

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