- Sep 20, 2021
The Chinese firm that is in the process of purchasing the largest chip manufacturing facility in the UK said that the deal might be in jeopardy now and that the U.K. government is reviewing the takeover. Wingtech Technologies in a note warned the shareholders of the “domestic and foreign industry policies” that might put the takeover of the Newport Wafer Fab at a risk. The U.K. prime minister Boris Johnson has assigned Stephen Lovegrove, U.K.’s national security advisor, to investigate the deal.
Wingtech bought the U.K. company Newport Wafer Fab for around £63 million through a Dutch subsidiary it owns called Nexperia in July. However, a spokesperson on behalf of the U.K. government revealed, “We have considered this issue thoroughly, and will continue to monitor the situation closely.”
Wingtech is one of the many companies that is backed by the Chinese government. Although the company is mainly concerned with assembling various devices, it has been noted that the interest of the company has gradually shifted to semiconductors. The fabs manufactured in the Newport Wafer Fab company are used mostly in the automobile industry. Like many other businesses, this company too has been hit hard by the global pandemic.
Amidst many other things that took place last year, the tech industry also saw a drastic shortage in chips. Semiconductors can be found in almost everything that is related to technology, ranging from toothbrushes to missile systems. A few British lawmakers have also raised issues with the government alleging that they are selling off some of its semiconductor companies to overseas buyers. If the deal with the China-based company is held off, Ron Black who was in charge of Imagination Technologies is eyeing to bid on Newport Wafer Fab to acquire it.
Furthermore, the U.K. government is also deciding if they should approve the sale of another U.K.-based chip designer Arm to another overseas buyer, this time the U.S. chip giant Nvidia.