Leading UK semiconductor firm up for sale
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A leading UK semiconductor firm has put itself up for sale and is in negotiations with a buyer.
IQE in Wales makes wafer substrates for companies to build compound semiconductor lasers, photonics chips and gallium nitride (GaN) chips for RF and power applications. Compound semiconductors are a key area for the UK’s semiconductor strategy and the loss of IQE would be a significant blow to the strategy.
This comes as RISC-V core and tool developer Codasip in Germany is also up for sale, marking the potential loss of another sovereign European technology supplier.
However IQE is facing a cash crunch. It is negotiations with several companies for the sale of its operation in Taiwan, and the proceeds would be used to repay its Revolving Credit Facility and provide cash to invest in its core operations
IQE has had a troubled few years, with its chief executive Americo Lemos stepping down suddenly in October last year: IQE CEO in shock departure
The company expects to make a loss in the first half of this year on a turnover of £44m ($50m). The full year revenue is expected to be around £100m ($120m), down from £118m in 2024. This would put the price at around $120m.
The loss comes from the deferral of certain contracts in the Wireless and Photonics segments as a result of continued global and macro uncertainty. This slowed down the unwinding of inventory levels at customers built up in 2023 and 2024, as well as lower spending in the US military and defence sector, says Jutta Meier, recently confirmed as the Chief Executive Officer.
There are a number of potential semiconductor firms that could be a buyer for IQE, and the company is in talks with one of them.
Soitec in France manufactures engineered silicon wafers and the IQE product line would be complementary. European chip maker STMicroelectronics is moving into photonics and already has strong product ranges using semiconductor wafers and GaN chips, and favours vertical integration from wafer to device. However it recently saw its first loss and is in the process of acquiring the MEMS business of NXP for $950m. IQE is also working with Belgian foundry X-fab on 1200V GaN parts, but X-fab is likely to remain a customer rather than a buyer.
Outside of Europe, Coherent in the US is a leading substrate supplier, including photonics, and has no GaN business, but it has been closing and selling off wafer plants.
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