By Greg Gao

Chinese listed ODM Wingtech announced on October 24 that it plans to invest RMB3 billion(about $411 million) in a new plant to expand the packaging and testing capacity of its subsidiary Nexperia, JW Insights learned.

Wingtech has signed an investment agreement with the local government of Dongguan, southern China’s Guangdong Province, where the plant is located. Wingtech will construct in several phases according to Nexperia’s actual business growth needs. The total investment will be completed in five years. The plant is expected to start construction within six months from the date of signing the land transfer contract and will be completed within 18 months after obtaining the construction permit.

The facility will make analog and logic ICs, metal-oxide-semiconductor field-effect transistors, Wingtech said, without revealing the expected output capacity of such products once the expansion is completed.

Wingtech said that after the project is implemented and put into production, it can effectively supplement its existing semiconductor packaging and testing capacity, enhancing the scale advantage of semiconductor products and improving the company’s long-term core competencies and sustained profitability.

This investment is implemented on the premise of ensuring the company’s daily operations and capital security, and will not have an adverse impact on the company’s financial and operating conditions, Wingtech added.

Wingtech acquired Nexperia in November 2019. Nexperia is a leading supplier of semiconductor devices, with business covering semiconductor design, manufacturing, packaging, and testing. Its customers include some internationally-renowned companies in the automobile, communications, and consumer goods sectors, according to media reports.