Nexperia Takes 100% Ownership of the Newport Wafer Fab

Netherlands-based chip manufacturer Nexperia announced it’s acquiring the Newport Wafer Fab, the U.K.’s largest microchip plant, in an effort to boost its production capacity amid growing market demand.

 

Image courtesy of the Newport Wafer Fab

 

Established nearly 40 years ago, the site is capable of producing over 35,000 200 mm wafer starts per month, supporting MOSFETs and trench IGBTs, CMOS, analog, and compound semiconductors, the announcement stated. According to its website, the 450-employee plant has the ability to expand to 44,000 wafer starts per month.

Nexperia is already a customer of Newport Wafer Fab’s foundry services, and the company became its second-largest shareholder in 2019. The acquisition would be a significant addition to its existing manufacturing sites in Europe, which are receiving a major overhaul as it aggressively ramps up its production capacity.

Last month, Nexperia announced a $700 million investment to expand production at its plants in Manchester, England, and Hamburg, Germany. The Hamburg fab, which produces 35,000 wafers per month, will receive a 20% boost in capacity by next year. And the Manchester site, which can produce 24,000 wafers per month, will expand 10% by mid-2022. Nexperia is also investing heavily in research and development.

The Newport Wafer Fab acquisition will support Nexperia’s IGBT, analog, and compound semiconductor product lines, which are undergoing production at its Manchester and Hamburg wafer fabs.

In the announcement, Nexperia COO Achim Kempe said the purchase allows the company to support the growing demand for semiconductors, adding, “The Newport facility has a very skilled operational team and has a crucial role to play to ensure continuity of operations.”

Though Nexperia is headquartered in the Netherlands, it is owned by Chinese smartphone manufacturer Wingtech Technology, which acquired the company for $3.6 billion in 2018 and later obtained a controlling stake. Given Nexperia’s Chinese backing, the Newport Wafer Fab deal is now under review by U.K. government officials, who raised national security concerns.

Meanwhile, the BBC reported last week that the Welsh government was blocked from investing more funding into the Newport Wafer Fab. A Welsh government spokesperson confirmed officials had discussed future plans and financial support with the previous directors. However, an agreement between the wafer fab’s then-majority shareholders gave certain legal rights to Nexperia and made it impractical for new investors—including the Welsh government—to further fund the business, reported the BBC.

Still, the Newport Wafer Fab’s departing chairman, Drew Nelson, stated in the announcement that the change in ownership “marks an important step for the future of the facility as well as for the region.” He added that the wafer fab would be able to “maintain the expertise in developing high-end silicon devices” while also pursuing opportunities to add new semiconductor technologies.