Government approves takeover of Newport Wafer Fab
Previous owner forced to sell stake over links to China
The UK government has given the green light to the sale of Newport Wafer Fab (NWF), the country's largest computer chip maker, to US-based Vishay Intertechnology for £140 million.
The approval comes after a review conducted under the National Security and Investment Act, which empowers ministers to intervene in transactions involving sectors deemed critical to national security.
The plant's previous owner, Netherlands-based Nexperia Group, owned a 14% stake, increasing that to 100% in July 2021. However, the deal faced intense scrutiny due to national security concerns stemming from Nexperia's ownership by Wingtech Technology.
A review by the UK government in late 2022 cited fears of potential influence from China undermining the country's semiconductor production capabilities, as well as knowledge transfer concerns. Following this, Nexperia was compelled to sell its stake in the facility.
US electronics giant Vishay stepped in in November last year, announcing its acquisition of the plant for a reported £140 million, a move welcomed for securing over 400 jobs.
The deal was subject to national security clearance, which has now been granted by secretary of state Oliver Dowden after a four-month wait.
"Following a detailed national security assessment, the deputy prime minister, in his role as secretary of state in the Cabinet Office, has allowed the proposed acquisition of Nexperia Newport Ltd by Vishay Intertechnology Inc to proceed," the Cabinet Office said.
While NWF does produce semiconductors, they are compound models: a different type from silicon-based computer chips. Its components are, however, used in a range of devices, from vacuum cleaners to cars.
The acquisition marks a new chapter for the plant, now rebranded as Newport Vishay. As the UK's largest semiconductor manufacturer, Newport Vishay aims to expand its operations, particularly in compound semiconductor R&D.
Government retains oversight
Although it approved the acquisition, the UK government has set stringent conditions on the deal.
Vishay must notify the government of any future agreements involving the transfer or access to the factory by third parties, ensuring tight control over intellectual property and sensitive information.
The approval has been met with relief and optimism by the Newport Wafer Fab Staff Association, which represents the site's 500 workers.
"This is great news. These have been difficult times, but now we would hope that the cloud of uncertainty previously hovering has moved on," a spokesperson said.
Vaughan Gething, Welsh minister for the economy, said he was relieved on behalf of the plant's workforce:
"Today's news brings security to a hugely talented workforce after a long period of uncertainty and I hope they can look forward a new sense of optimism," Gething said.
Labour's shadow Welsh secretary, Jo Stevens, hailed the decision as long-overdue good news for Newport's workers, though criticised the government for delays in addressing the matter.
Welsh secretary David TC Davies welcomed the clearance, looking forward to Vishay International's plans for the plant.