The UK's largest chipmaking facility has been bought by American semiconductor firm Vishay in a $177 million deal.
Newport Wafer Fab in South Wales, which makes semiconductors used in a host of electronic products including for smartphones and cars, was earlier this year put up for sale after the government ordered Chinese-owned firm Nexperia to give up its control of the plant on national security grounds.
Joel Smejkal, President and CEO of Vishay, said: "By agreeing to acquire Newport Wafer Fab, our goal is to safeguard the positions of the highly skilled and dedicated employees.
"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.
“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 2021, then-Prime Minister Boris Johnson asked National Security Adviser Sir Stephen Lovegrove to examine the purchase of Newport Wafer Fab by Chinese-owned Nexperia for a reported £63 million, with MPs calling on ministers to urgently intervene.
Ciaran Martin, who was chief executive of the National Cyber Security Centre (NCSC) until August, said the future of microchip supply was a “first order strategic issue” for the country.
Nexperia's acquisition was then called-in for a full national security assessment by then-Business Secretary Kwasi Kwarteng in May last year, using powers to intervene in business deals granted under the National Security and Investment Act. It was ordered to sell the plant in November last year.
Nexperia had expressed its 'shock' at the move. In a statement the firm said: "The UK Government chose not to enter into a meaningful dialogue with Nexperia or even visit the Newport site."
Toni Versluijs, Country Manager, Nexperia UK, said today: “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.
"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 today’s announcement provides this. Of all options, this agreement with Vishay is the most viable one."
Pennsylvania-based Vishay is one of the US's largest manufacturers of semiconductors and passive electronic components used in the automotive, military, aerospace, and medical markets.
In a statement the Welsh Government said: “We are pleased to see Vishay’s intention to grow the workforce and further invest significant amounts in the Newport facility.
“This should end a period of uncertainty and we look forward to seeing the UK Government commit to support the Newport site in line with the UK Semiconductor Strategy."
