U.K’s power as the semiconductor Innovator of Europe has dwindled over the years because its government deliberately allowed the chip manufacturers of its country to be sold off to international buyers. Arm Ltd. whose tech is used in 90% of all mobile devices in the world, was sold off to SoftBank Group Ltd.
And now the company will be handed over to Nvidia, which is yet another international buyer. Imagination was sold to a Chinese buyout fund, and the deal was signed off by then-Prime Minister Theresa May.
To sum it all up, total semiconductor companies which were valued at about $42 billion have been sold to foreign buyers since May 2010. And it all happened when the current Conservative government came to power, according to Bloomberg. And the $42 billion is excluding what Nvidia paid for Arm.
Currently, the world is facing a shortage of semiconductors and the chip manufacturers can leverage this by raking in large contracts. However, one of the last semiconductor assets of the U.K, Newport Wafer Fab Ltd., is not being snapped up by a Chinese manufacturer for around 63 million pounds ($87 million). And guess what, the countries Prime Minister Boris Johnson’s government is pledging to review the deal after giving the initial wave. It’s like throwing in the water to quench the fire after everyone died in the building.
“Newport Wafer Fab is extremely worrying. We need coherence in dealing with the Chinese state. I worry that we are still not there, and I worry that we are still failing to understand our dependency on China and the need to move away from that trade dependency.”
There have been major changes in the countries relationship with its allies. The United States has increasingly stopped deals involving semiconductors, and European countries are also becoming increasingly protectionist over local chip technology. Most of the countries are intervening in the sales of their semiconductor assets sales, recently Italian Prime Minister Mario Draghi also intervened to halt the sale of Milan-based LPE SpA, which produces components for power electronics applications. Which the Shenzhen Invenland Holdings Co. tries to buy in April.
“The government needs to call this in and block it. This yet again shows that despite the legislation, despite all the earlier tough talk, the government is looking two ways on China. On the one hand, it says it is worried about China, but on the other hand, it wants a trade deal. The government’s policy on China is an utter mess without hope and purpose. This sale is an investment disaster.” – Bloomberg
