A consortium of six companies is ready to step in with a £300m bid for Newport Wafer Fab if the 海角视频 Government blocks its acquisition by a Chinese company.
Ron Black, who is leading the group of companies, did not directly call for ministers to block Shanghai-owned company Nexperia from taking over Britain’s biggest microchip factory in Newport, but in his first public comments on the bid he said all technology deals should be "strongly considered on national security grounds".
Mr Black told : “What we're looking to do is to provide an alternative to the current deal if either Nexperia or the Government conclude that an alternative is necessary."
Mr Black, the former chief executive officer of Imagination Technologies, said the plans would also help transform south Wales into a hub for advanced chipmaking.
The National Security Adviser Sir Stephen Lovegrove has been asked to examine the sale of the South Wales -based microchip manufacturer to a Chinese-owned firm by Prime Minister Boris Johnson.
Nexperia, is based in the Netherlands but is owned by the Chinese firm Wingtech Technology, completed a £56m acquisition of the plant in Newport last month in a move safeguarding 470 jobs with plans for fresh investment.
Mr Black has said is working with three electronics companies and three financial investors, based in the 海角视频, Europe and the US on a takeover proposal.
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Mr Black added he had spoken to “people around economic development in Wales” and would welcome government investment as part of any deal. He said the acquisition could include a bid that would more than return Nexperia’s investment in the company, potentially up to £100m, and could also include a further £200m of spending to expand the plant’s capacity.
While he did not name the companies, he said the three technology firms - two publicly listed - were looking to secure a regular supply from the factory and were involved in areas such as power supplies, communications and infrastructure.
He added: “These companies are looking for strategic relationships over a long period of time."
Mr Black did not comment directly on whether ownership of the plant by Nexperia was a national security risk, he said the ownership of technology companies should be treated as a security issue.
“The presumption I would always start with is that it’s a national security concern, unless proven otherwise," he told the Telegraph.
"The risk is asymmetric because getting it wrong has devastating potential impacts.”
Nexperia has said that while it was acquired by Chinese tech firm Wingtech two years ago, its parent company has a range of shareholders via its listing on the Shanghai Stock Exchange.
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It become the second biggest shareholder in NWF in 2019 at which stage it invested to support the operation. However following supply and liquidity concerns it said it was forced to intervene after being told that the business faced collapse in the first quarter of this year. This first saw it appointing two directors prior to the acquisition.
It added that while it wasn’t contractually obliged to do so, it opted to repay the Welsh Government’s £13m loan, with interest in full, that the previous owners of NWF, led by IQE chief executive Drew Nelson, has secured when acquiring the facility in 2016 in a management buy-in buyout deal from German firm Infineon.
In June Tory MP and chairman of the Foreign Affairs Select Committee, Tom Tugendhat, wrote to Business Secretary Kwasi Kwarteng raising concerns over "a Chinese takeover of NWF on national strategic asset and security grounds".
Sir Stephen’s review is reportedly expected to be completed in the next few weeks, but the future of the deal will potentially remain uncertain until January, when stronger national security laws come into force allowing ministers to block foreign takeovers.
Last month a spokesperson for Nexperia said: “In light of the review that has been ordered by the Prime Minister, we did not intend to make further public comment until this review had concluded.
“However this report by Mr Tugendhat MP and his committee contains numerous inaccuracies both around the nature of our ownership and the background to the acquisition of the Newport Wafer Fab, which must be corrected on the record.
Our parent company is not Chinese state-owned as has been asserted. Wingtech Technology Co Ltd is listed on the Shanghai Stock Exchange with a vast and diverse number of public shareholders.
“The entirety of Wingtech’s issued share capital is listed on the Shanghai Stock Exchange, with only one class of shares in issuance. All shares have the same rights attached to them.
“We have been a customer of Newport Fab for some time and provided equity investment to the company in 2019 as its second largest shareholder in order to ensure that they could stay solvent. In exchange for this significant financial commitment, like any sensible company would have done, we asked for protection rights including the right to appoint board members if the company came into financial difficulty again.
“It was however only when they came to us and told us that they may collapse in Q1 of this year that we decided we had no choice except to step in whereupon we voluntarily repaid Newport’s debt to the Welsh Government, rescued the company from potential administration, secured 500 jobs and rescinded the salary freeze that had been placed upon its employees.”
Nexperia has not made a comment on Mr Black’s consortium.