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10 November 2023

Vishay Intertechnology to Acquire Nexperia’s Newport Wafer Fab for $177 million


Vishay Intertechnology have announced that they have entered into an agreement to acquire Nexperia’s wafer fabrication facility and operations in Newport, for approximately $177 million in cash.

Earlier this year Nexperia Newport, had been ordered by the UK Government to sell its microchip facility in south Wales on national interest and security grounds.

Newport Wafer Fab, located on 28 acres, is an automotive certified, 200mm semiconductor wafer fab that supplies primarily automotive markets. It is the largest semiconductor manufacturing site in the UK.

Under new leadership in early 2023, Vishay set an ambitious goal of investing approximately $1.2 billion in capacity over a three-year period in order to position the company to seize the opportunities created by the megatrends of e-mobility and sustainability needed for a Net Zero economy. While this transaction is supplemental to its capex investment strategy, adding Newport Wafer Fab to its manufacturing footprint will be instrumental to achieving the businesses goal of expanding its capacity for customers.

Joel Smejkal, President and CEO of Vishay, commented:

“By agreeing to acquire Newport Wafer Fab, our goal is to safeguard the positions of the highly skilled and dedicated employees and to invest the necessary capital to set up production for our SiC Trench MOSFETs and diodes. With its solid balance sheet and ample liquidity, Vishay will immediately bring stability and its reliable cash flow generation to ensure the facility becomes a fully operational and profitable fab” added Mr. Smejkal.

“For Vishay, acquiring Newport Wafer Fab brings together our capacity expansion plans for our customers in automotive and industrial end markets as well as the UK’s strategic goal of improved supply chain resilience. In addition to expanding capacity, we intend to collaborate with the Compound Semiconductor Cluster in South Wales and to join with key stakeholders committed to developing the semiconductor industry in the UK including university and community partners in the UK and particularly South Wales,”concluded Mr. Smejkal. “We look forward to welcoming Newport Wafer Fab’s employees into Vishay and to partnering with local authorities and the Welsh and UK Governments to both ensure long-term growth for the fab and deliver value to our customers and stockholders.”

Responding to the Vishay announcement, Welsh Economy Minister Vaughan Gething said:

We welcome the announcement that Vishay is investing in the thriving semiconductor cluster in Newport.  This is a great example of a Welsh economic strength with truly global reach attracting major global investment.

“Global demand for semiconductors is set to explode in the coming years and Newport is perfectly placed to turn that growth into more long term, quality careers.  The committed, skilled workforce which Wales already boasts, with strong buy in from academic, business, local and Welsh Government partners, makes this a great, ambitious place to invest.

“We are pleased to see Vishay’s intention to grow the workforce and further invest significant amounts in the Newport facility.

“This should end a period of uncertainty and we look forward to seeing the UK Government commit to support the Newport site in line with the UK Semiconductor Strategy.

“The Welsh Government has invested in and championed the industry for many years and we welcome Vishay’s intention to work in partnership with us and the cluster members.  I intend to meet the company today to discuss its plans.

“I confirmed yesterday that we are prepared to work with the UK Government to establish an Investment Zone in South East Wales that can provide further support for this key growth area.”

Marc Zandman, Executive Chairman of the Board, Vishay said,

“Vishay’s Board made a critical decision last year to pivot the company toward profitable growth under new leadership, leveraging the company’s solid cash flow generation, sound operational capabilities and broad product portfolio. A key element of this strategic shift is the investment in technologies and incremental capacity to position Vishay to capitalize on the megatrends in e-mobility and sustainability. Acquiring Newport Wafer Fab demonstrates Vishay’s commitment to executing this strategic shift, and to realizing improved returns for our stockholders.”

Toni Versluijs, Country Manager, Nexperia UK, stated:

“Nexperia would have preferred to continue the long-term strategy it implemented when it acquired the investment-starved fab in 2021 and provided for massive investments in equipment and personnel. However, these investment plans have been cut short by the unexpected andwrongful divestment order made by the UK Government in November 2022. The UK Government’s order, in combination with aweakness in the global semiconductor market, recently led us to announce the intention to reduce the number of employees at the site by at least 100. The site needs clarity about its future to avoid further losses, and today’s announcement provides this.

Of all options, this agreement with Vishay is the most viable one to secure the future of the site as Vishay – like Nexperia – has a solid customer base for the fab’s capabilities. For the site, Vishay’s commitment to further make the Newport Wafer Fab a success story is encouraging.Nexperia’s position with regards to the UK Government’s order remains unchanged.” The closing of Newport wafer fab transaction is subject to UK government review, the purchase rights of a third party, and customary closing conditions, and is expected to occur in the firstquarter of 2024.

 



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