Today, SMIC announced on the Hong Kong Stock Exchange that the company will sell LFoundry to the new buyer for $113 million. The new buyer is Wuxi Tin Micro-Semiconductor Co., Ltd.

The sale of LFoundry was established in 1989, when it owned the largest 6-inch DRAM production line in Europe in the Italian city of Avezzano. In 1994, it established a small 8-inch DRAM production line. In 1998, it was acquired by Taiwan Micron Technology. After more than 10 years, he became a subsidiary of Micron Technology. In 2001, the 8-inch capacity conversion was completed and the DRAM capacity climbed. In 2005, the image processor production line was established and the image processing field was cut. In 2008, Micron's image sensor division separated Aptina Imaging image processing company from the company, and the company's production line became the image. Handling the company's foundry and converting it from IDM to a foundry. In 2013, the company's shareholders took the leveraged acquisition method to separate the company from Micron Technology and became an independent semiconductor company with OEM as its main business.

LFoundry's business covers automotive electronics, security and industrial applications, including CIS, smart power, touch-screen displays and embedded memory, with advanced 8-inch production lines and 150nm and 110nm processologies, optimized for CIS and back Lighting technology supports CMOS image sensors. According to the latest data, LFoundry's 8-inch wafer production capacity exceeds 40,000 pieces per month, and revenue for FY2017 is $230 million. In June 2016, SMIC invested 49 million Euros to acquire a 70% stake in LFoundry, an Italian integrated circuit foundry controlled by LFE and MI. SMIC, LFE and MI each accounted for 70% and 15% of LFoundry's corporate capital. 15% share ratio.

The original buyer of LFoundry was Jiangsu Zhongke Junxin. On March 31 this year, SMIC announced that it will sell 70% of LFoundry's shares to Zhongke Junxin for US$112,816,089, and the transaction is expected to be completed by the end of June this year.

According to this announcement, the seller (SMIC), the target company, the former buyer (Jiangsu Zhongke Junxin) and the new buyer (Wuxi Tin) reached a transfer agreement on June 27.

Former buyer Jiangsu Zhongke Junxin Technology Co., Ltd. is a Sino-foreign joint venture high-tech enterprise specializing in the research and development of new power electronic chips such as IGBT and FRD. Founded at the end of 2011, the company is a research and development entity centered on the Research Institute of Silicon Devices and Integration Technology of the Institute of Microelectronics of the Chinese Academy of Sciences and the Power Electronics Device R&D Laboratory of the China Internet of Things Research and Development Center.

According to public information, the company won the favor of international and domestic well-known professional investment institutions in 2014, 2016 and 2018, and completed several rounds of financing. The investment institutions include Lihe Venture Capital, Walden International, TEDA Science Investment, and Chinese Army. Branch, Dongfeng Motor Group; enter the rapid development and integration of upstream and downstream resources.

The new buyer is a newly established Wuxi tin micro core, a semiconductor company jointly invested by Taiji Industrial Co., Ltd., Wuxi Industry Group, Wuxi Weifu Hi-Tech, Wuxi Spark, and Chuxin Semiconductor.

According to the latest announcement of Taiji Industry, the registered capital of Tin-based micro-core is RMB 2.11 billion, of which Wuxi Industry Group has subscribed for 910 million yuan, accounting for 43.13%; Wuxi Spak has subscribed for 600 million yuan, accounting for 28.43%; Taiji Industry and Wuxi Weifu Hi-Tech and Chuxin Semiconductor each invested 200 million yuan, accounting for 9.48% of the shares.

The reason for this change is not very clear, but new and old buyers still have some links. According to Tianyue, the controlling party of Wuxi Tin Microchip includes Wuxi Spark Microelectronics and Chuxin Semiconductor Technology Co., Ltd., and the two shareholders include Jiangsu Zhongke Internet of Things Technology Venture Capital Co., Ltd. and Beijing Zhongzhong. Kewei Investment Management Co., Ltd. Further investigation found that Jiangsu Zhongke Internet of Things Technology Venture Capital Co., Ltd. was established by the China Internet of Things Research and Development Center with a total investment of 200 million yuan. It is a wholly state-owned enterprise with independent legal person qualification. Beijing Zhongke Micro Investment Management Co., Ltd. is also one of the shareholders of Jiangsu Zhongke Junxin. Therefore, the two companies are inextricably linked.

Another point is that the legal representative of Wuxi Tin is Ye Xianchun, the current director of the Institute of Microelectronics of the Chinese Academy of Sciences, and Ye Tianchun has served as the legal person of Zhongke Junxin, but has already withdrawn in April 2015.

As a start-up company, Wuxi Tin's micro-core purchase of LFoundry will use its technical strength to develop a wide range of products and enter the lucrative automotive and industrial sectors. And, according to the announcement, “There will be new investors joining the new buyer in the future, and with the increase in new buyer capital, the capacity of LFoundry will be further strengthened.”