Wingtech Technology: The UK requires Nexperia to reduce its majority stake in Nexperia on the grounds of "national security"

Latest update time：2022-11-18

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According to British media reports, on November 17, Nexperia (Nexperia), a subsidiary of Wingtech Technology, received an official notice from the British Department of Business, Energy and Industrial Strategy that it must reduce its shares in Newport Wafer Fab (NWF) by 86% and return to It will hold just 14% of the company when it takes over in 2021 in an effort to "reduce national security risks."

Nexperia is located in Nijmegen, the Netherlands. It was formerly a division of NXP Semiconductors. It was sold to a Chinese financial consortium and spun off as an independent company. In 2018, it became a wholly-owned subsidiary of Wingtech Technology.

Nexperia was shocked and dismayed by the announcement, saying it did not accept the rationale and that 500 jobs were now at risk.

The company said in a statement: "Nexperia's far-reaching remedial measures to fully address the government's concerns have been completely ignored. The UK government has chosen not to engage in meaningful dialogue with Nexperia or even visit New York. Porter Factory. More than 500 NWF employees have also raised their concerns about the notice - and the government has chosen not to listen to them and instead make this decision, which has cost them and their families their livelihoods and the livelihoods of more than 100 million people. Pounds of taxpayers' money are being put at risk completely unnecessarily."

It is reported that on July 5, 2021, Nexperia announced that it had completed the signing of a transaction agreement to acquire NWF. Through this acquisition, Nexperia acquired 100% ownership of the semiconductor silicon chip production plant. In May of this year, the UK Department of Business issued a statement requiring a "comprehensive national security assessment" of the acquisition. According to the UK National Security and Investment Act, the government has the right to review and, if necessary, intervene in qualified acquisitions on the grounds of national security, or even directly reject them.

An Nexperia signboard has been erected outside the NWF factory, picture from foreign media

Ciaran Martin, former chief executive of Britain’s National Cyber Security Centre, said the takeover posed a greater threat to British interests than the involvement of Chinese company Huawei in 5G networks.

Tom Tugendhat, the former chairman of the House of Commons Foreign Affairs Committee, expressed concern that companies, particularly Chinese ones, have a track record of using foreign investment to acquire vital technology and information.

The release of the findings has been delayed. The initial decision deadline was June this year , but the Department for Business, Energy and Industrial Strategy asked for a decision to be made within a 45-day deadline.

Further delays came as the UK Tory leadership race continued over the summer, with the government playing a political role following the departures of former Prime Minister Kwasi Kwarteng and then Elizabeth Truss.

On the afternoon of the 17th, Wingtech Technology announced that after the UK National Security and Investment Act came into effect, the UK Secretary of State for Business, Energy and Industrial Strategy exercised statutory powers in accordance with the new National Security and Investment Act to retroactively review the acquisition of NWF by Nexperia, a wholly-owned subsidiary of the company. Nexperia received a formal notice from the UK Department of Business, Energy and Industrial Strategy, requiring Nexperia to divest at least 86% of NWF's equity. After evaluation, the acquisition amount, revenue and net profit of NWF accounted for less than 1% of the company's corresponding indicators, which had little impact on the company, and its current production capacity contribution did not constitute a significant impact on the company's production and operations. Since the new transferee and the transaction pricing method have not yet been determined, there is uncertainty about the impact on the company's financial data during the subsequent transfer of NWF.

Information shows that Newport Wafer Fab (NW F) is located in Newport, South Wales. It is the largest wafer manufacturer in the UK. Founded in 1982, it is the world's first integrated silicon and silicon-based composite wafer fab, and The world's first compound semiconductor device factory.

NWF is an open wafer fab. With 40 years of world-class high-end silicon device manufacturing experience, NWF has become an important manufacturing service provider in many important industries and markets, providing volume manufacturing and technology transfer for the silicon, compound semiconductor and photonics markets. and services, with customers ranging from large power semiconductor silicon customers to custom photonics and composite fab companies.

NWF is capable of manufacturing power and compound semiconductor ICs on 200 mm diameter wafers, with a monthly production capacity of 32,000 8-inch wafers and a maximum production capacity of 44,000 wafers. Develop a wide range of semiconductor technologies, from MOSFET/TIGBT using wafer dilution methods to analog and compound semiconductor CMOS. It converts and enhances MOSFET/TIGBT processes and uses an automotive approach to routing systems to develop photonic and composite processes and devices from the initial concept/design phase to production.

Before being acquired by Nexperia, NWF had signed a 10-year contract with Infineon and a 7-year contract with the second largest semiconductor company. Both contracts focus on silicon power, with many products serving the automotive market. NWF also intends to expand its customer portfolio in other industry sectors such as data communications and healthcare.

For Nexperia, after acquiring NWF, it can obtain a monthly production capacity of approximately 35,000 200mm wafers, which can also be expanded to a monthly production capacity of 44,000 wafers within the current scope, which is nearly doubled. In addition, Nexperia's own wafer fab currently does not have the production capacity for IGBT chips. Therefore, the successful acquisition of NWF will help Nexperia further extend its product line, further enrich its automotive chip supply capabilities, and increase its market share.

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Wingtech Technology: The UK requires Nexperia to reduce its majority stake in Nexperia on the grounds of "national security"​

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Wingtech Technology: The UK requires Nexperia to reduce its majority stake in Nexperia on the grounds of "national security"