Chip acquisition deal valued at US$4 billion

Wingtech Technology Co plans to use 27.4 billion yuan (US$3.97 billion), with a new investment of 3 billion yuan from home appliance giant Gree, to acquire a controlling stake of Dutch semiconductor firm Nexperia Holding, Shanghai-listed Wingtech said during the weekend. 

After the acquisition, Wingtech will become the biggest listed semiconductor firm in China, with annual sales of 100 billion units of electronics components used in telecommunications, automotive and industrial devices. 

Wingtech raised the acquisition value to 27.4 billion yuan, from the original value of 25.2 billion yuan as media reported previously, with new investors including Gree. Gree, China’s biggest air conditioner maker, contributed 3 billion yuan for the acquisition and became Wingtech’s shareholder through the deal. Wingtech will resume trading after halt of the trading for about seven months, the company said in statements to the Shanghai Stock Exchange. 

Wingtech, an ODM or original design manufacturer firm with clients including Huawei and Xiaomi, will expand in the upstream in the industry chain to areas like auto electronics, IoT or the Internet of things and 5G.

Both sides will establish a research center after the deal, said Zhang Xuezheng, Wingtech’s chairman.

“The acquisition will improve China’s competitive ability and global influence,” said Zhang, who was quoted in an article posted on the company’s website.

Nexperia is a semiconductor component maker spun off from NXP Semiconductors. Automotive electronics is Nexperia’s largest business.