[3] Between 1989 and 1990, the company made a high-profile attempt to start a memory chip foundry in the United States, leasing a dilapidated plant in Kansas City, Missouri, owned by AT&T Microelectronics.

[6]: 27–28  The Reddy brothers had high hopes that the Alliance factory would rejuvenate interest in manufacturing DRAM among American semiconductor foundries, who had largely retreated from this market segment in the mid-1980s owing to intense competition from Japanese conglomerates.

[3][5] Wealthy benefactors and disparate corporations from Kansas City, including UtiliCorp United and Hallmark Cards, had poured millions of dollars into the project, hoping that it would create a high-tech industry in the area.

[6]: 27 [8] The company abandoned pretenses of ever managing their own chip manufacturing plant, spending the rest of its existence as a fabless outfit, focusing on designing DRAM and static RAM (SRAM).

[6]: 28 Although SRAM and DRAM remained Alliance's dominant focus, the company began diversifying slightly in the mid-1990s after acquiring Nimbus Technology, a GPU designer, in 1993.

[11] In February 1995, Alliance signed onto a $10-million investment in Chartered Semiconductor Manufacturing, a startup chip maker based in Singapore.

[15][16] By the mid-2000s the company was severely financially troubled,[17] and in March 2006, founder N. Damodar Reddy resigned as chairman of Alliance, while remaining on the board of directors.

The company's new chairman, Bryant R. Riley,[18] began the process of dissolving Alliance that year, first selling off its chipset technologies business for US$5.8 million to Tundra Semiconductor, who acquired that division's patents and rehired over 50 of their engineers, in April 2006.