Chinese-owned company is BLOCKED from taking over Britain’s largest semiconductor manufacturer over national security concerns
- Nexperia announced last year it acquired a 100% stake in Newport Wafer Fab
- The £63m deal was called in for review by Kwarteng in May over security risks
- Now Grant Shapps has issued order ‘requiring Nexperia to sell at least 86%’ stake
- Nexperia said it was ‘shocked’ by the decision – adding 500 jobs are now at risk
The government has blocked a Chinese-owned company’s takeover of a Wales-based microchip maker, calling it a risk to national security.
Nexperia, a Netherlands-based firm owned by China’s Wingtech, announced last year that it had acquired a 100 per cent stake in Newport Wafer Fab, Britain’s biggest semiconductor manufacturers.
Under national security legislation introduced in January to prevent ‘those who may do us harm from acquiring parts of the UK’s economy’, the £63 million deal was called in for a review by Kwasi Kwarteng, then the business secretary, in May.
Now business secretary Grant Shapps has issued an order ‘requiring Nexperia to sell at least 86 per cent of Newport Wafer Fab to prevent against potential national security risks.’
Nexperia, a Netherlands-based firm owned by China’s Wingtech, announced last year it had acquired a 100% stake in Newport Wafer Fab, one of Britain’s biggest semiconductor manufacturers
The factory has for decades been a critical site, producing tiny silicon chips. Currently there is a global shortage of the semiconductors that go in cars and everyday electronics
Shapps said development of the Newport site by Nexperia could ‘undermine U.K. capabilities’ in the sector.
As the new legislation covers deals only on or after November 12, 2020, Nexperia will retain the 14 per cent it bought in 2019.
It has also owned a plant in Stockport, employing 1,000 people, for 50 years, which is not affected by the ruling.
Nexperia said it was ‘shocked’ by the decision – adding that 500 jobs are now at risk.
‘The decision is wrong, and we will appeal to overturn this divestment order to protect the over 500 jobs at Newport,’ the firm’s U.K. country manager, Toni Versluijs, said. ‘This decision sends a clear signal that the U.K. is closed for business.’
Britain has grappled with balancing the importance of economic ties with China and concerns about Beijing’s growing global clout and assertiveness.
The head of Britain’s MI5 intelligence agency, Ken McCallum, on Wednesday highlighted the ‘scale and breadth of (China’s) information acquisition, using not only intelligence officers and cyberhackers but businesspeople and researchers to steal government and commercial information alike.’
At a Group of 20 summit in Indonesia this week, Prime Minister Rishi Sunak said China was ‘the biggest state-based threat to our economic security,’ though he has also stressed the importance of ties with Beijing.
Shapps said development of the Newport site by Nexperia could ‘undermine U.K. capabilities’ in the sector. As the new legislation covers deals only on or after November 12, 2020, Nexperia will retain the 14 per cent it bought in 2019. Pictured: Extreme Close-up View of a Single Semiconductor Chip
The China Research Group of U.K. Conservative lawmakers, which argues against closer ties with China, welcomed the government’s decision.
‘Our long-term security relies on the resilience of our economy and that means ensuring we don’t allow strategic assets to fall into the hands of authoritarian powers for the sake of short-term advancement,’ it said in a statement.
The factory has for decades been a critical site, producing tiny silicon chips. Currently there is a global shortage of the semiconductors that go in cars and everyday electronics.
Source: Read Full Article