UK requires Chinese-owned Nexperia to divest 86% stake in chip producer NWF

Asian Tech Press (Nov 17) -- The UK has asked Chinese-owned company Nexperia to divest at least 86% stake in Newport Wafer Fab (NWF), the country's largest chip factory, citing national security concerns.

The Department for Business, Energy & Industrial Strategy (BEIS) on Wednesday demanded that Nexperia must sell at least 86% of its shares in NNL within a specified period and in accordance with a specified process.

Nexperia, a Dutch subsidiary of Chinese firm Wingtech Technology Co.,Ltd., renamed NWF as Nexperia Newport Limited (NNL) after completing the acquisition for £63 million ($75 million) in July last year.

In May, UK regulators launched a full national security assessment of the acquisition, which involved Chinese investments. During the review process, NWF's production and operation were normal.

Nexperia said Thursday it felt shocked by the British government's decision and "will appeal to overturn this divestment order to protect the over 500 jobs at Newport."

In a statement on Thursday, Wingtech said, "After evaluation, Nexperia's NWF acquisition has a relatively small impact on the company, and its current capacity contribution does not constitute a significant impact on the company's production and operation."

Chinese investment in the semiconductor industry seems to have been facing many difficulties. What happened to Wingtech in the UK is similar to what happened to another Chinese company in Germany.

Last week, Germany blocked the acquisition of chipmaker Elmos Semiconductor SE's automotive chip plant by Swedish company Silex Microsystems AB, a subsidiary of Chinese company Sai Micro Electronics Inc.

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