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SMIC gains $172 million investment from Tatang Holdings
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Chinese telecommunications firm, Datang Telecom Technology & Industry Holdings has invested $172 Million in Chinese foundry, SMIC. The deal gives Datang a 16.6% interest in the Company proforma for the new shares issued. The investment is expected to be part of a drive by both companies to be key suppliers of IC’s to China’s rollout of Time Division-Synchronous Code Division Multiple Access (TD-SCDMA), technology and infrastructure. China is implementing its own 3G system and standards, compared to many other regions of the world.
Datang Holdings will have the right to nominate, for the appointment by the Board, two Board representatives out of a total of nine members of the Board of Directors at SMIC as well as the right to nominate a Vice President at SMIC in charge of Time Division-Synchronous Code Division Multiple Access (TD-SCDMA), technology.
Dr. Chen Shanzhi, Datang Holdings Vice President, said “We have attached great importance to our investment into SMIC, a world-class semiconductor manufacturing and service company. With SMIC and Datang Holdings working together, I am confident this powerful alliance will significantly promote the development of China’s semiconductor as well as mobile telecommunication industries, and improve the international competitiveness of both companies by taking advantage of the opportunities arising from the rapid development of TD-SCDMA 3G in China.”
SMIC has been seeking investment partners due to its continued operating losses and tight credit conditions.