China buyout of chip company ‘cancelled’: Commerce Secretary Jacob Rhys-Mogg plans action following acquisition of Newport wafer fab
Jacob Rhys-Mogg may overturn controversial China-backed takeover of British chip company to address widespread concerns about industry hollowing out.
The government will order Dutch company Nexperia, which is owned by China’s Wingtech, to slash its stake in Newport Wafer Fab, the Financial Times reported.
The Commerce Secretary’s decision is expected by October 3, and the former owner of the South Wales company is said to be coordinating a buyback bid with private equity group Palladian Investment Partners. .
The Chinese threat: A decision by business secretary Jacob Rees-Mogg (pictured) on the future of chip maker Newport Wafer Fab is due by October 3
Former Science Minister George Freeman backed the intervention, saying:
Rees-Mogg’s agenda could also include whether to call for a takeover of London-listed software company Aveva for closer scrutiny.
France’s Schneider, which already owns a majority stake in the Cambridge-based company, is nearing a £9 billion deal to swallow the remaining stake.
Under acquisition rules, Schneider has one week to make a formal offer today, and last month revealed that it was considering an acquisition.
Aveva’s stock jumped 3.1%, or 91p, to 3050p yesterday as the company closed.
The deal could come under further scrutiny given Schneider’s joint venture with Chinese firm Delixi Group.
The decision embodies the delicate balance Rees-Mogg must strike between showing the UK open to business and protecting key industries.
Nexperia previously held a 14% stake in Newport Wafer Fab, but last year acquired the rest of the company in a £63m deal.
The company manufactures semiconductor “wafers” and ships them to the Philippines to be sliced for use in products such as cars and smartphones.
Opposing the deal, Freeman said Newport Wafer Fab is the “jewel in the crown” of chip companies in South Wales.
“If we are serious about becoming a science and technology superpower, then adversaries like Russia and China engaged in economic warfare are the supreme powers of great strategic and geopolitical importance. We cannot silently accept the acquisition of technology from
Meanwhile, the US is reportedly looking to expand restrictions on shipments to China of chips and chip-making tools used in artificial intelligence.
Washington has already sent letters to US chip giants Nvidia and Advanced Micro Devices telling them to stop shipping some AI chips to China unless they get a license.
Susannah Streeter, senior investment and market analyst at Hargreaves Lansdown, said that chip technology “will inevitably require cooperation with the United States.”
The government declined to comment on the FT report. Nexperia declined to comment. The Mail reached out to his Palladian for comment.
https://www.dailymail.co.uk/money/markets/article-11209067/Business-Secretary-Rees-Mogg-reverse-Newport-Wafer-Fab-buyout.html?ns_mchannel=rss&ns_campaign=1490&ito=1490 Business Secretary Rees-Mogg ‘reverses’ Newport Wafer Fab buyout