Nexperia’s Newport Wafer Fab is available for purchase by a group of investors

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London – The consortium has raised money from banks and private equity investors to fund potential bids for silicon wafer maker Newport Wafer Fab, according to someone familiar with the situation that wanted to remain anonymous due to the nature of the discussion. ing.

NWF Currently acquired by Nexperia, which is owned by China However, the transaction may be blocked by the UK Government.

The sale of NWF to Nexperia was first approved by UK business secretary Kwasi Kwarteng earlier this month.But the British Prime Minister Boris Johnson ordered National Security Adviser Stephen Lovegrove said the acquisition raised national security concerns given the geopolitical importance of the semiconductor industry, after some lawmakers in his party said it raised national security concerns. Review it.

Consortia planning to submit alternative plans to the government, according to CNBC sources, include prominent semiconductor executives and those previously involved in NWF.

Sources said the government is unlikely to ask Nexperia and NWF to “unravel” the deal or force Nexperia to sell 100% of the company. But for everyone, it may seem to see if there are alternative plans that are “both sides beneficial,” sources added.

The compromise could include asking Nexperia to reduce its position at NWF to less than 25% in order to comply with the UK’s National Security Investment Act, which was introduced in April. It also includes asking the person who purchased the NWF to enter into some long-term contract with Nexperia to get the wafers they need.

The consortium and its investors are watching what the government is doing. A CNBC source said, “Investors are on the sidelines.’Okay, we got the money. Let’s go … what’s the matter?'” There are a lot of investors. There is a global shortage of such things. “

The consortium is rushing to submit a proposal to the government before lawmakers go to summer vacation in August, stagnating Westminster.

In the proposal, the consortium plans to argue that Nexperia may make it more difficult for external organizations to use its South Wales-based manufacturing facility in the United Kingdom.

NWF is the last “open access” fab in the UK and is used for research and development purposes by businesses, start-ups, universities, and governments.

Nexperia, who was already a shareholder of NWF Paid about 63 million pounds In the case of NWF ($ 87.9 million), according to CNBC sources. If Nexperia sold 75% of NWF to comply with National Security Investment Law, this would work for around £ 50m.

A spokesman for the British government told CNBC that the situation was closely monitored. Nexperia declined to comment.

Tony Abbott, senior trade adviser to Johnson and former Prime Minister of Australia, said on Tuesday: He expects the current transaction to be blocked.. Abbott said he would not allow the acquisition if it was made in Australia, adding that the UK is moving in the “equivalent direction” as Lovegrove is considering a deal.

The sale of NWF to Nexperia will take place five years after Arm, the UK’s largest chip company, was sold to Japan. Softbank At £ 24.3 billion. SoftBank is currently trying to sell Arm to Nvidia for $ 40 billion, but the deal is being investigated by competition regulators in the United Kingdom, Europe, China and the United States.

Nexperia link to China

Headquartered in the Netherlands, Nexperia is 100% owned. Wingtech Technologies, A Shanghai-listed manufacturer that assembles smartphones and other home appliances. Wingtech Great boost to the Chinese Communist PartyAccording to an analysis by Chinese investment screening specialist Datenna. Wingtech Chairman Xuezheng Zhang became CEO of Nexperia in March 2020.

Former UK cybersecurity chief Ciaran Martin Told the Telegraph The sale of NWF to Nexperia last week poses greater risk than Huawei’s involvement in 5G networks.

“Huawei around 5G really became a problem because the Trump administration was obsessed with it in a compelling way,” said the former director of the National Cyber ​​Security Center. “In contrast, the future of semiconductor supply is a primary strategic issue. It is at the heart of how we should deal with China.”

Some UK legislators are concerned that the NWF deal will pass to China a rare UK advanced chip manufacturing plant that aims to surpass the US, South Korea and Taiwan in semiconductor technology. ..

Tom Tugendart, leader of the UK government’s Chinese research group and chairman of the Foreign Affairs Selection Committee, told CNBC that the government said, “The UK’s largest semiconductor foundry uses technology to provide geopolitical leverage. A country with a proven track record. “

What is NWF?

Entrance to the Newport Wafer Fab manufacturing facility in Newport, Wales.

NWF was trying to raise money earlier this year to maintain independence, but Nexperia has invoked a contractual clause that allows it to take over the facility.

“They basically saw the opportunity to make a hostile takeover and did it,” sources said, adding that Nexperia rejected the £ 15m investment earlier this year.

The price paid to NWF is significantly lower than the price sold by similar fabs. “Wafer Fabs have a very small £ 63m price tag,” Glenn O’Donnell, an analyst at research firm Forester, told CNBC. “Most wafer fabs cost well over £ 1 billion. Even if this is old technology, the deal is ridiculously cheap.”

The fab is also doing semiconductor research for the British government.It has More than a dozen contracts They are primarily funded by the UK Government’s innovation agency, Innovate UK, through a variety of grants amounting to approximately £ 55 million.

One NWF defense contract involves the development of chip technology with Cardiff University for radar systems used in fighters. The £ 5.4m project aims to provide technology to defense industry contractor Leonardo, missile developer MBDA, and aerospace chip maker Araris.

Nexperia’s Newport Wafer Fab is available for purchase by a group of investors

Source link Nexperia’s Newport Wafer Fab is available for purchase by a group of investors

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