Bottom line Chinese overseas semiconductor M&A strategy: Can it really drain the US chip industry?
The consolidation trend sparked by the global semiconductor industry is undoubtedly the hottest topic of concern in the past two years, and the most important information that has not been disclosed at the negotiation tables this year is that almost every M&A case has the presence of Chinese investors - or the embodiment of private equity firms headquartered in the United States, but behind the scenes there are funds traceable to China
In relation to Marvell、Micron、Atmel、Anadigics、Micrel、Pericom Semiconductor、PMC-Sierra、Lattice Semiconductor In transactions with companies such as Western Digital (WD), bidders from China have almost always been lurking in the past two years of negotiations and have indeed (or presumably) attempted to make a move.
EE Times recently interviewed several corporate executives, academics, industry professionals, and market observers, who stated that although a few Chinese investors have indeed acquired several large chip suppliers so far, Chinese buyers continue to actively compete for high-tech companies in the United States and Europe.
A recent high-profile case is the bidding, negotiation, and strategy behind the acquisition of Lattice Semiconductor, a programmable logic component supplier. Lattice announced in early November that Canyon Bridge, a private equity firm based in Palo Alto, California, has agreed to acquire the company, but the latter's funding source is related to the Chinese government, and the deal may face obstacles as it cannot pass the Foreign Investment Review Board (CIFUS) review.
According to Lattice's proxy statement submitted last month, Canyon Bridge was only one of the 17 buyers bidding to acquire Lattice; This document does not mention the names of those bidders, only listed under codes such as' A 'and' Q '. A detailed bidding history shows that since June 15, 2015, a financial advisor representative from 'Party A' - a funding sponsor from China - has been in contact with Lattice's senior advisor Abid Ahmad regarding strategic transactions, indicating that Lattice had become an acquisition target a year and a half ago.
The power of attorney statement shows that Lattice CEO Darin Billerbeck has visited Beijing multiple times to meet with investors with codes A, B, E, and K; According to several sources from EE Times, many bidders are Chinese investors or manufacturers registered in the United States with Chinese funds.
Will CIFUS scrutiny become increasingly strict?
The US government has adopted a containment strategy against China's attempt to invest large sums of money in acquiring overseas high-tech manufacturers based on national security reasons; For example, Tsinghua Unigroup originally planned to invest $3.78 billion in Western Digital (as well as SanDisk, which was acquired by WD), but the case has been decided to be cancelled after CIFUS intervened in the investigation on national security grounds.
2020-09-04Reading volume：6571
