Taiwan chip firm KYEC to exit mainland China
King Yuan Electronics Co will divest its Suzhou manufacturing hub in a bid to minimise its exposure to geopolitical tensions.
KYEC is one of the world’s largest semiconductor testing and packaging services firms, and currently operates a facility at Suzhou in the eastern Jiangsu province. But it has now confirmed it will dispose of its 92.16% share in the subsidiary for around USD 676 million.
The buying consortium includes King Legacy Investments, LePower (HK), Anchor Light Holdings, Suzhou Industrial Park Industrial Investment Fund, TongFu Microelectronics, and the Shanghai State-owned Enterprises Integrated Improvement and Experiment Private Equity Fund Partnership. The deal is expected to be completed within the third quarter of this year.
KYEC said in a press release that its decision was based on the impact of US restrictions, which have made it harder for mainland Chinese enterprises to access advanced chip manufacturing equipment.
It said: "Due to the impact of geopolitics on the global semiconductor supply chain, such like United States' restrictions on China's semiconductor industry technology, the ecological environment of semiconductor manufacturing in China has changed, along with intensified market competition. KYEC fully considers the environment in which KLT operates, weighs KYEC’s strategic planning for future operational development and growth, and aims the long-term use of financial resources more effectively. The board of directors has made a decision to withdraw from China’s semiconductor manufacturing business."
