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Old boss is new suitor for Newport Wafer Fab

Newport Wafer Fab, which has recently been in the news for its Chinese owner, Nexperia, is making rounds in the trade media amid a decision expected to be made by the UK government by 3 October 2022. According to a Financial Times story, its former owner, Drew Nelson, could buy back the semiconductor fab from the Chinese-owned Nexperia.

Source: Nexperia

In 2021, the semiconductor manufacturing plant, staffing 450 people in the Welsh city of Newport, was struggling to pay its debts and faced potential bankruptcy. That’s when Nexperia, which had become Newport Wafer Fab’s second-biggest shareholder with a 14% stake in 2019, made the call to wholly own the semiconductor fab.

However, the sale to Nexperia, a Dutch company owned by China’s Wingtech Technology, began raising alarm bells, given that Newport Wafer Fab is the largest chip manufacturing facility in the UK. That was followed by UK officials calling Nexperia to substantially reduce its ownership of the fab. And now the news about the fab’s former owner getting into action for buyback clearly points to a likely outcome in which it’ll be hard for Nexperia to own Newport Wafer Fab, now increasingly being seen as a strategic national asset.

Nelson, according to news reports, has teamed up with private equity group Palladian Investment Partners to make a bid for Newport Wafer Fab. It’s worth mentioning that Imagination Technologies’ former CEO Ron Black has also expressed interest in acquiring Newport Wafer Fab through a consortium he is heading.

Besides the often-quoted national or economic security grounds, Black has pointed toward a dangerous vacuum that unstable conditions could create at the semiconductor manufacturing facility. He especially mentioned the staff exodus as one potential outcome.

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