Editing by Li Panpan

Non-semiconductor Chinese companies are still keen to invest in the IC industry in 2021. At least ten such listed companies initiated acquisitions or increased capital in semiconductor companies, according to a report by JW Insights.

Note: The ten investors are Phenix Optics, Wongtee International, Oriental Star, TOREAD, Hopewind, Tianfu Energy, Zhezhong Group, Yawei Machine-Tool, Huhua Group, and CiXing.

Most of the listed companies entered the semiconductor industry by choosing companies related to silicon wafers and power devices.

In the past few years, many listed companies expanded to the semiconductor business by investing significant capital through mergers and acquisitions. Last year the trend was not to seek full holding of a company but to inject an appropriate amount of capital, or invest in new startups.

The overall investment amount was getting relatively smaller. In 2021, more than half of the listed companies acquired a small proportion of shares, seeking no full ownership nor decision-making power. They tend to go for financial gains.

The semiconductor companies that received investment are mostly young with performance to desired. Most of them were established after 2018, some in 2021; Many are running in loss, and some even have not released their products.

IDM MEMSonics, favored by CiXing and Oriental Star, had zero revenue in the past two years and lost more than RMB38 million ($6 million) in the first 11 months in 2021. IDM Ever Power, invested by Wongtee International, lost RMB13.19 million ($2.08 million) in 2020 and RMB23.55 million ($3.72 million) just in the first four months of 2021, with increased losses. Sino Crystal, invested by Zhezhong Group, hasn’t released products and lost RMB25.7 million ($4.06 million) in the first eight months of 2021.