Boris U-turn over probe into sale of microchip maker to Chinese firm

Boris Johnson U-turns to confirm national security adviser WILL probe sale of UK microchip maker Newport Wafer Fab to Chinese firm Nexperia – but urges nation not to succumb to ‘anti-China spirit’ saying it would be ‘economically foolhardy’

  • The PM confirmed Sir Stephen Lovegrove will examine the £63million deal 
  • Netherlands-based Nexperia owned by Chinese electronics company Wingtech
  • Despite MPs raising security fears, Government reviously refused to intervene

The government’s national security adviser is to examine the sale of a UK microchip maker to a Chinese firm, Boris Johnson said today.

The Prime Minister confirmed the U-turn to ask Sir Stephen Lovegrove to examine the £63million deal that would see Welsh company Newport Wafer Fab taken over by Nexperia.

NWF’s facility in South Wales manufactures crucial power components for cars that have been in limited supply amid a global shortage of microchips.

But Netherlands-based Nexperia is owned by Chinese electronics company Wingtech, whose shareholders include state-funded investors.

Despite MPs raising security concerns this week, the Government had previously refused to intervene.

The Welsh Government had also welcomed the investment, which will safeguard 400 jobs at the factory and help pay off several outstanding debts.

However, facing the Liaison Committee this afternoon, Mr Johnson said: ‘We are looking into it, I have asked the NSA to review … we will look at it again.’

The Prime Minister confirmed the U-turn to ask Sir Stephen Lovegrove to examine the £63million deal that would see Welsh company Newport Wafer Fab taken over by Nexperia.

Ministers have been urged to intervene because Nexperia is owned by Chinese electronics company Wingtech, whose shareholders include state-funded investors (stock image)

NWF’s facility in South Wales manufactures crucial power components for cars that have been in limited supply amid a global shortage of microchips.

He said the Welsh Government had asked the UK Government to deal with the issue – something it later denied.

‘There is this company in Newport, we have to judge whether the stuff that they are making is of real intellectual property value and interest to China, whether there are real security implications, I have asked the National Security Adviser to look at it,’ Mr Johnson  said. 

However, in his exchange with Tom Tugendhat, a China hawk and the chairman of the Foreign Affairs Committee, he cautioned against refusing all Chinese investment.

‘I don’t want us and I do not want anti-China spirit to lead to us trying to pitchfork away every investment from China into this country,’ Mr Johnson said.

‘That would be economically foolhardy.’

Mr Tugendhat has previously urged ministers to review the deal under the National Security and Investment Act. 

He warned that the UK was ‘turning a blind eye to Britain’s largest semiconductor foundry falling into the hands of an entity from a country that has a track record of using technology to create geopolitical leverage’.

 Such chips, which act as the brains of digital devices, are used in everything from cars to washing machines to toothbrushes – but there are not enough to keep up with the increasing demand. 

Analysts have warned the global shortage – which has affected the automotive industry the most – could last until 2023.

It has put a spotlight on the supply chain as a result, with governments increasingly concerned about their reliance on foreign chip manufacturers.

The deal will protect some 400 jobs at the factory – which produces 8,000 wafers, mass-produced sheets of microchips, each week – and help pay off several outstanding debts.

The Welsh Government today denied asking Boris Johnson’s administration to deal with the Newport Wafer Fab issue.

‘The Welsh Government has not made a request to the UK Government to review the takeover of Newport Wafer Fab,’ a spokesman said.

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