Dhe multi-billion dollar sale of the Munich chip supplier Siltronic to Taiwan has collapsed. Siltronic’s competitor Globalwafers did not get the approval from the Federal Ministry of Economics and Climate for the 4.35 billion euro takeover, which would have been necessary under the Foreign Trade Act, in good time. A spokeswoman for the ministry justified this on Tuesday night with lack of time: “Not all the necessary review steps as part of the investment review could be completed – this applies in particular to the review of the antitrust approval by the Chinese authorities, which was only granted last week.” Globalwafers could but try again.
“Then the investment review will of course be carried out again,” said the spokeswoman. But whether Globalwafers wants that is questionable. CEO Doris Hsu had made it clear that if she failed, she would invest elsewhere – probably outside of Europe.
Approval from China only last week
The exam had dragged on since the end of 2020. In a long poker game with the Siltronic shareholders, Globalwafers had secured a good 70 percent stake in the Munich company. But the approval of the Chinese antitrust authorities only arrived last week. Among other things, this stipulated that Globalwafers split off part of the Danish subsidiary Topsil in order not to impede competition in the market for 8-inch silicon discs (wafers) for chip production.
This makes Siltronic by far the largest takeover by a foreign company that fails because of the Foreign Trade Act. Failure had long been expected on the stock exchange. Siltronic shares closed at EUR 116 on Monday, around a fifth below Globalwafers’ offer of EUR 145.
As a reason for the long duration, the ministry pointed out that the Foreign Trade Ordinance and takeovers in special technology areas required a detailed examination. The benchmark is the expected impairment of public order, the security of Germany or other EU member states. High and future technologies must be checked particularly carefully. These include artificial intelligence, autonomous driving, robotics and semiconductors. Wafer manufacturers such as Siltronic supply the silicon discs on which the semiconductors are produced to the chip industry.
The chip emergency in the corona pandemic had shown how dependent Europe is on Asian providers. Among the five largest silicon wafer manufacturers, Siltronic is the only one from Europe. Globalwafers wanted to catch up with the global market leader Shin-Etsu Chemical from Japan with the takeover. The Taiwanese point out that they supply more wafers to European customers than Siltronic. Although the Munich company produces in Burghausen, Bavaria, and in Freiberg, Saxony, it has its largest production facilities in Singapore. Siltronic’s major shareholder Wacker Chemie will lose 1.2 billion euros in revenue from the sale as a result of the failure.
EU wants to support the semiconductor industry with billions
Germany had already tightened foreign trade law before the change of government. The new Economics Minister Robert Habeck (Greens) had already emphasized in December that Germany and Europe would have to produce a growing proportion of microelectronics themselves. The EU Commission wants to present its “Chips Act” in February and support the industry with sums in the tens of billions. “It wouldn’t fit the time to sell something from the semiconductor sector to Asia,” says an industry expert.
The investment plans of foreign investors are increasingly coming to the attention of the Ministry of Economy. From 2018 to 2020, the number of tests had doubled to 160. In 2021, the number of test procedures shot up to 306.
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