Pixelworks announces equity investments in its Shanghai subsidiary
Pixelworks' majority-owned subsidiary, Pixelworks Semiconductor Technology (Shanghai), has entered into an agreement with a group of private equity and strategic investors based in China, as well as with entities owned by PWSH employees, under which committed investments will be made in exchange for an equity interest in the subsidiary.
The capital increase agreements consist of the commitment by employee entities to pay amounts in RMB equating to approximately USD 1.4 million in exchange for a total equity interest of 0.54% in PWSH, and by non-employee investors to pay amounts in RMB equivalent to approximately USD 14.3 million in exchange for a total equity interest of 2.76% in PWSH. Following the anticipated closing of these transactions, Pixelworks, Inc. will continue to hold an approximately 78.2% equity interest in PWSH.
"This latest transaction to secure additional capital investment in our PWSH subsidiary is a testament to the recognised value of our visual processing technology in China as well as the associated growth opportunity for this portion of our business. In addition to this new capital further solidifying PWSH's overall financial position, it provides increased flexibility in support of executing on our growth and operational objectives as we continue to prepare PWSH to apply for a local listing in coming year," says President and CEO of Pixelworks, Todd DeBonis, in a press release.
Additionally, the company reaffirmed its previously provided financial guidance for fourth quarter total revenue of between USD 16 million and USD 18 million.