Newport microchip manufacturer could be bailed out by taxpayers money if Chinese deal is blocked
Taxpayer’s money could be used to rescue the UK’s biggest microchip factory if ministers block its sale to the Chinese.
The takeover of microchip manufacturer Newport Wafer Fab by a Chinese-owned company was called in for a “full national security assessment” last week after growing pressure from MPs amid concerns that it has been acquired by a “strategic competitor”.
Under the terms of the legislation, ministers have the power to scrutinise and, if necessary, intervene in the acquisition on national security grounds.
The Government has an initial period of 30 working days – potentially extendable by up to 45 days – to carry out that assessment.
At least two consortia are believed to have expressed an interest in funding a bid for the plant if this deal is reversed and one of those, a US-backed group, has reportedly held talks with the £1bn Automotive Transformation Fund (ATF) about supporting high-tech research at the Newport Wafer Fab facility.
According to the Daily Telegraph, the consortium is understood to have held talks with Ian Constance, the chief executive of the Advanced Propulsion Centre, which runs the ATF.
Money would be offered as grant funding, rather than the ATF taking an equity stake in any takeover.
The newspaper reports the group has spent months lining up funding and executives to take on the plant.
One source said this could include former members of Newport Wafer Fab’s management team.
The ATF was set up last year to fund investment in electric vehicles and infrastructure, and earlier this year it put around £100m into BritishVolt, the British battery “gigaplant” in Northumberland.
The fund is believed to be interested in developing advanced microchip technology that could support fast-charging stations at the company’s factory in Duffryn.
Nexperia, which is owned by the Chinese technology company Wingtech, acquired Newport Wafer Fab for £63m last year.
The plant fell into financial trouble during the pandemic, allowing Netherlands-based Nexperia, which owned 14% of Newport Wafer Fab, to exercise an option to buy it.
China now controls more than nine per cent of the global semiconductor market, closing in on the EU which controls 10%.
Support our Nation today
For the price of a cup of coffee a month you can help us create an independent, not-for-profit, national news service for the people of Wales, by the people of Wales.