Dutch Government Takes Control of China-Owned Chipmaker Nexperia (reuters.com) 38
"Dutch authorities have temporarily nationalized Nexperia, owned by Chinese company Wingtech, over fears of critical product unavailability," writes longtime Slashdot reader evil_aaronm. Reuters reports: The Hague invoked never-before-used powers under a Dutch law known as the "Availability of Goods Act." The decision led to a 10% fall in Wingtech's shares in Shanghai on Monday. The Dutch government will not take ownership of Nexperia, but it will now have the power to reverse or block management decisions it considers harmful. The company's regular production is continuing. [...] Wingtech called the Dutch government's intervention in Nexperia, once part of Dutch electronics group Philips, "excessive interference driven by geopolitical bias." Wingtech also alleged that non-Chinese Nexperia executives had tried to forcibly alter the company's equity structure through legal proceedings in a "cloaked power grab" on the company.
A copy of an Amsterdam commercial court ruling dated October 7 and seen by Reuters showed that the court decided on October 1 to suspend Wingtech CEO Zhang Xuezheng from his position as executive director at Nexperia after finding "well founded reasons to doubt" the company was pursuing correct management policy or actions under Dutch civil law. It appointed Dutch businessman Guido Dierick to take Zhang's position with a "deciding vote", and transferred control of almost all of Nexperia's shares to a Dutch lawyer for management. The Dutch state and the company's labour council had supported the moves, the document showed. [...]
In its statement, the Dutch government said that administrative problems at Nexperia posed a threat to the company's "crucial technological knowledge" without elaborating. "The loss of these capabilities could pose a risk to Dutch and European economic security," it said. Nexperia is one of the world's largest makers of simple computer chips such as diodes and transistors, though it also develops more advanced technologies such as "wide gap" semiconductors used in electrical settings and useful for electric cars, chargers and AI data centres. Wingtech said in a filing to the Shanghai stock exchange on Monday that its control over Nexperia would be temporarily restricted due to the Dutch order and court rulings, affecting decision making and operational efficiency.
A copy of an Amsterdam commercial court ruling dated October 7 and seen by Reuters showed that the court decided on October 1 to suspend Wingtech CEO Zhang Xuezheng from his position as executive director at Nexperia after finding "well founded reasons to doubt" the company was pursuing correct management policy or actions under Dutch civil law. It appointed Dutch businessman Guido Dierick to take Zhang's position with a "deciding vote", and transferred control of almost all of Nexperia's shares to a Dutch lawyer for management. The Dutch state and the company's labour council had supported the moves, the document showed. [...]
In its statement, the Dutch government said that administrative problems at Nexperia posed a threat to the company's "crucial technological knowledge" without elaborating. "The loss of these capabilities could pose a risk to Dutch and European economic security," it said. Nexperia is one of the world's largest makers of simple computer chips such as diodes and transistors, though it also develops more advanced technologies such as "wide gap" semiconductors used in electrical settings and useful for electric cars, chargers and AI data centres. Wingtech said in a filing to the Shanghai stock exchange on Monday that its control over Nexperia would be temporarily restricted due to the Dutch order and court rulings, affecting decision making and operational efficiency.
Be careful of unintended consequences (Score:1, Flamebait)
Foreign companies thinking about creating jobs in The Netherlands may now think twice. "Could something similar happen to me?"
Re:Be careful of unintended consequences (Score:4, Informative)
Wingtech bought out Philips. They probably didn't create any jobs.
Re: Be careful of unintended consequences (Score:2)
Maybe they avoided some job losses?
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Possibly. But that implies that Philips was going to go under (or restructure) failing a buyout. Odds are good that Wingtech saw an opportunity to gain a foothold in a foreign market and took it, with some encouragement from their 40% totally-not-CCP shareholder overlords. Which might explain why the Netherlands has taken such a keen interest in exerting partial control over their activities.
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Maybe they avoided some job losses?
Nexperia went through significant stuff cuts since it's 2018 takeover from Wingtech.
Now maybe they did have some job gains, but I suspect they were not in the Netherlands.
Re: Be careful of unintended consequences (Score:3)
Actually, they didn't...it's somewhat more complicated than that.
NXP Semiconductors needed to sell its Standard Products division (which would become Nexperia) to raise money and gain regulatory approval for its own planned merger with Qualcomm.
The buyer was not Wingtech, but a consortium of investors led by Wise Road Capital (Jiæ(TM) Chengèæoe), a Chinese private equity firm focused on semiconductors.
Wingtech bought it from them.
NXP Semiconductors needed to sell its Standard Products divisio
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Okay so NXP spun off Philips and a Chinese consortium bought it out. There's still no clear indicator that the "standard products division" (Philips) was financially moribund and in need of a bailout.
Re: Be careful of unintended consequences (Score:4, Informative)
No you got it backwards. Philips spun off Philips Semiconductors as NXP Semiconductors.
Philips is still a Dutch company listed on the Amsterdam stock exchange.
NXP is still a Dutch company listed on the Amsterdam stock exchange.
A part of NXP was Nexperia which manufactured standard components. This was sold off in 2016 to a Chinese investment consortium JAC Capital who then onsold it to Wingtech in 2018.
We're only talking about a part of a part of Philips here.
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Okay, it wasn't clear before who was spinning off whom. That clears things up a bit.
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Note they bought it *from Philips*, they didn't buy out Philips itself, that's still a Dutch company.
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"Could something similar happen to me?"
They're only going to deter foreign companies from taking full control over Dutch companies.
Re: Be careful of unintended consequences (Score:2)
This isn't a Dutch company, is it?
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Reuters seems to have blocked my IP for some stupid reason, so maybe someone can elaborate on what the actual issue here is. What management decisions are at issue?
Is this asset stripping and technology transfer? If so, I applaud them. I wish the UK did that, we have had huge problems with asset strippers over the last few decades.
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Thanks, that explains it.
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True. But perhaps putting off Chinese buyouts is an intended consequence?
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Foreign companies thinking about creating jobs in The Netherlands may now think twice. "Could something similar happen to me?"
It's a Dutch fab company that got gobbled up by a Chinese company. It was originally part of Philips. Foreign companies didn't create jobs in this case, unless the fab grew significantly in the last six years. If anything, they've been selling off some of their existing fabs [vishay.com].
From all indications, the main purpose of the takeover was to prevent sending technology secrets to China, and possibly to prevent the illegal sale of their chips to Russia [nltimes.nl].
Nothing to see here. Move along.
Re: Be careful of unintended consequences (Score:2)
That sounds a lot like shutting the barn door after the horse has bolted...also, it is still a Chinese company, so this action seems rather limited if the objective is as you say.
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That sounds a lot like shutting the barn door after the horse has bolted...also, it is still a Chinese company, so this action seems rather limited if the objective is as you say.
Yup. I never said it made sense. They're several years too late, and should have shut down that purchase before it happened. But I'm thinking about some quote along the lines of "The best time to figure it out was years ago, but the second best time to figure it out is today," or something like that. :-)
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More information has come out on this matter:
https://m.youtube.com/watch?v=... [youtube.com]
It appears as though Nexperia manufacturers ICs that can be used in missile guidance systems and for other military applications. Apparently Chinese companies were smuggling ICs from Nexperia to Russian manufacturers which is not in alignment with the Dutch government's position on Russia and their war against Ukraine.
Companies never "think" (Score:2)
>> Foreign companies thinking about creating jobs
That is some smelly stuff right here.
Companies never "think", and don't care about jobs.
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The right wing has always enjoyed stealing other people's stuff and giving it to their cronies. That's what they go into politics for, normally.
Re: Delicious irony (Score:1)
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Wrong. He's independent.
https://en.wikipedia.org/wiki/... [wikipedia.org]
But I'm not surprised reading non-sense like this.
Any Dutch person not supporting Gaza, LGTB, and basic communism is considered a far right extremist these days.
Re: Delicious irony (Score:2)
Taking *control*, not ownership...yet.
Due diligence -- ? (Score:3)
Re:Due diligence -- ? (Score:4, Informative)
Private companies can change ownership freely. What has changed is China is now openly considered an adversary, which was not the case 9 years ago.
The EC did analyze but can only oppose if market distortions in the EEA can be expected; which is not the case because NXP/Nexperia have plenty of competition in the EU.
the European Commission has concluded that the notified operation falls within the scope of the Merger Regulation and of paragraph 5(c) and 6 of the Commission Notice on a simplified procedure for treatment of certain concentrations under Council Regulation (EC) No 139/2004.4 [...] the European Commission has decided not to oppose the notified operation and to declare it compatible with the internal market and with the EEA Agreement. https://ec.europa.eu/competiti... [europa.eu]
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That's the job of politicians and as you find out, they are too lazy to think.
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When the Wingtech purchase was first discussed, did no one in the Netherlands consider that it might be a bad idea to have this "critical" company in the majority hands of a foreign organization? Seems like no one did their homework.
Perhaps they, unlike you, were aware that they had this law available to them to use to prevent this critical company from acting against their nation's interests.
and the view from the other side (Score:2)
The Dutch government’s seizure of Nexperia sent shock waves across the commercial world this week. State expropriation (a diplomatic word for what is too often simply “confiscation” or even “theft”) has historically been very rare – until the recent freezing of Russian assets by the western powers.
European nations have agreed to steal, er, expropriate, the interest dividends earned by the Russians’ cash. (The Europeans' excuse, which is on the lines of "Well, they d
Re:and the view from the other side (Score:4, Informative)
The Dutch governmentâ(TM)s seizure of Nexperia sent shock waves across the commercial world this week. State expropriation
...is SOP in China [sciencedirect.com]. Collect your fifty cents at the door and fuck off, paid Chinese troll.
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