China’s Big Fund invests yet more billions in memory firms

China’s Big Fund invests yet more billions in memory firms

Business news |
By Peter Clarke

China’s Big Fund has topped up its investment in two domestic memory chipmakers with several billions of dollars, according to reports.

The China Integrated Circuit Industry Investment Fund has provided “billions of dollars” to 3D-NAND flash memory manufacturer Yangtze Memory Technologies Corp. (Wuhan, China), according to a Financial Times report. It has also invested US$2 billion in a company called Changxin Xinqiao Memory Technologies Inc. (Hefei, China), according to Reuters.

However, there is some confusion over the identity of Changxin Xinqiao Memory Technologies Inc. which is identified as being founded in 2021 but which shares a primary address and CEO with the more-established DRAM maker Changxin Memory Technologies Inc. (CXMT), founded in 2016.

This comes only months after the company was received a US$7 billion cash injection to help keep the company going despite US pressure, in March 2023 (see YMTC gets $7 billion cash injection). YMTC was added to a US export control list in December 2022 (see YMTC could be out of 3D-NAND by 2024, says TrendForce) and this was considered likely to be a crippling blow as it could limit or prevent access to leading-edge chip manufacturing equipment.

Meanwhile China’s state-backed venture capital fund has invested 14.56 billion yuan (about US2.0 billion) into a DRAM chip company Changxin Xinqiao Memory Technologies. Reuters reporte that according to the company registration website Qichacha, Changxin Xinqiao was founded in 2021 in Hefei city, in the eastern Anhui province and has the same general manager – Zhao Lun – as CXMT.

One potential explanation is that Changxin Xinqiao is a subsidiary company formed to build a 300mm wafer fab in Hefei.

China launched the Big Fund in 2014 and over about three years invested about US$30 billion in an attempt to accelerate China’s semiconductor industry. In 2019 China’s Big Fund raised a further US$30 billion to continue the effort.

However, some of those funds were reportedly mis-applied and gave rise to a corruption scandal that saw several senior fund executives arrested in 2022 (see Another China ‘Big Fund’ executive is detained).

China is reportedly preparing to launch a third round of state-backed investment with a target of 300 billion yuan (about US$41 billion).

Related links and articles:

YMTC gets $7 billion cash injection

YMTC could be out of 3D-NAND by 2024, says TrendForce

Ministry official to lead China’s troubled ‘Big Fund’

Another China ‘Big Fund’ executive is detained

China raising $30 billion for Big Fund’s second phase

Yangtze Memory CEO reportedly leaving post

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