Vishay to buy Newport fab for $117m
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Vishay Intertechnology has agreed a deal with Nexperia to buy the troubled power fab in Newport, Wales.
However the deal also includes the rights of an unspecified third party on the purchase of the 28 acre site in Newport with a 200mm automotive certified power fab.
The site is the largest fab in the UK and was bought by Nexperia for a reported $87m back in July 2021. It was seen as a potential part of the UK’s semiconductor strategy with a sovereign compound semiconductor foundry.
Seattle-based fab broker ATREG served as Nexperia’s transaction advisors as the company was looking for a buyer after the UK government forced a sale over Nexperia’s links to its Chinese owner: Broker engaged to sell Newport wafer fab
“Nexperia would have preferred to continue the long-term strategy it implemented when it acquired the investment-starved fab in 2021 and provided for massive investments in equipment and personnel,” said Toni Versluijs, Country Manager, Nexperia UK.
“However, these investment plans have been cut short by the unexpected and wrongful divestment order made by the UK Government in November 2022. The UK Government’s order, in combination with a weakness in the global semiconductor market, recently led us to announce the intention to reduce the number of employees at the site by at least 100. The site needs clarity about its future to avoid further losses, and the announcement provides this.
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“Of all options, this agreement with Vishay is the most viable one to secure the future of the site as Vishay – like Nexperia – has a solid customer base for the fab’s capabilities. For the site, Vishay’s commitment to further make the Newport Wafer Fab a success story is encouraging. Nexperia’s position with regards to the UK Government’s order remains unchanged,” he said.
Vishay, based in the US, sees the fab being used for manufacturing its silicon carbide power devices.
“By agreeing to acquire Newport Wafer Fab, our goal is to safeguard the positions of the highly skilled and dedicated employees and to invest the necessary capital to set up production for our SiC Trench MOSFETs and diodes. With its solid balance sheet and ample liquidity, Vishay will immediately bring stability and its reliable cash flow generation to ensure the facility becomes a fully operational and profitable fab” said Joel Smejkal, President and CEO of Vishay.
“Under new leadership in early 2023, Vishay set an ambitious goal of investing approximately $1.2 billion in capacity over a three-year period in order to position the company to seize the opportunities created by the megatrends of e-mobility and sustainability needed for a Net Zero economy. While this transaction is supplemental to our capex investment strategy, adding Newport Wafer Fab to our manufacturing footprint will be instrumental to achieving our goal of expanding capacity for our customers and to accelerating our SiC strategy,” he added.
“For Vishay, acquiring Newport Wafer Fab brings together our capacity expansion plans for our customers in automotive and industrial end markets as well as the UK’s strategic goal of improved supply chain resilience. In addition to expanding capacity, we intend to collaborate with the Compound Semiconductor Cluster in South Wales and to join with key stakeholders committed to developing the semiconductor industry in the UK including university and community partners in the UK and particularly South Wales. We look forward to welcoming Newport Wafer Fab’s employees into Vishay and to partnering with local authorities and the Welsh and UK Governments to both ensure long-term growth for the fab and deliver value to our customers and stockholders.”
Marc Zandman, Executive Chairman of the Board, Vishay said, “Vishay’s Board made a critical decision last year to pivot the company toward profitable growth under new leadership, leveraging the company’s solid cash flow generation, sound operational capabilities and broad product portfolio. A key element of this strategic shift is the investment in technologies and incremental capacity to position Vishay to capitalize on the megatrends in e-mobility and sustainability. Acquiring Newport Wafer Fab demonstrates Vishay’s commitment to executing this strategic shift, and to realizing improved returns for our stockholders.”
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The closing of Newport wafer fab transaction is subject to UK government review, the purchase rights of a third party, and customary closing conditions, and is expected to occur in the first quarter of 2024.
www.Vishay.com; www.nexperia.com
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