(FILES) A novel 300-millimeter wafer containing semiconductor chips and finished microchips made by German semiconductor manufacturer Bosch is seen in Dresden, eastern Germany, May 31, 2021. The factory will officially open next week, June 7, 2021. German multinational engineering and technology group Bosch is investing around EUR 1 billion in the high-tech semiconductor manufacturing facility in Dresden, which will be one of the most modern wafers. (Photo by JENS SCHLUTER / AFP)
Business Secretary Grant Shapps blocked Nexperia’s full acquisition of Newport Wafer Fab following a “detailed national security assessment,” a government spokesman said in a statement.
Shapps has urged Nexperia to sell at least 86 percent of the Wales-based chipmaker “to prevent potential national security risks,” the spokesman said.
In his official statement, Shapps said there was a risk related to “technology and know-how that could result from a potential reintroduction of compound semiconductor activities at the Newport site and the potential of those activities to undermine UK capabilities”.
Dutch company Nexperia, owned by Chinese smartphone giant Wingtech, completed the purchase of Newport Wafer Fab for an undisclosed amount in July last year.
The deal for a leading British industrial company sparked a political outcry in the UK amid increasingly strained relations between London and Beijing and growing scrutiny of Chinese companies’ overseas investments.
In 2020, London banned Chinese telecoms giant Huawei from being involved in the rollout of Britain’s super-fast 5G broadband network after the US raised concerns over espionage. Beijing was angry about this.
British Prime Minister Rishi Sunak came to power last month and spoke out harshly against China but had signaled a desire to engage in the trade. He was scheduled to hold bilateral talks with Chinese President Xi Jinping at the G20 summit in Indonesia this week.
But the meeting was canceled when Western allies held a rushed conclave in Bali in response to a Russian missile attack on Ukraine that involved NATO member Poland.
The UK will “remain committed to business and open investment while protecting national security,” the spokesman said of the Newport Wafer Fab announcement.
The news was welcomed by the China-hawks in the UK Parliament.
“Our long-term security depends on the resilience of our economy and that means making sure we don’t allow strategic assets to fall into the hands of authoritarian powers to move forward in the short term,” Conservative MP Alicia Kearns said.
“I’m sure many will be relieved that we are not handing over critical security infrastructure to a company with well-documented ties to the Chinese state,” she said.
© Agence France-Presse