China's Semiconductor State Fund Invests £2 Billion in Memory Chip Firm
Updated: Nov 2
In a significant move to bolster its semiconductor industry, China's state-backed chip investment fund has invested £2 billion ($2.74 billion) in Changxin Xinqiao, a memory chip company.
The investment was made by the China Integrated Circuit Industry Investment Fund, also known as the "Big Fund," which now holds a 33.15% stake in Changxin Xinqiao.
Changxin Xinqiao, founded in 2021 in Hefei city, Anhui province, aims to establish a manufacturing base for 12-inch memory wafers. This project will be the first in China to go into mass production for integrated dynamic random access memory (DRAM) design and manufacturing. The company's general manager, Zhao Lun, is also the general manager of ChangXin Memory Technologies, one of China's leading memory chip companies.
The investment by the Big Fund follows its earlier investment of £13 billion into Yangtze Memory Technologies (YMTC), China's sole player in the global NAND memory market. YMTC has been expanding its production capacity and research and development with the support of state subsidies. However, it was blacklisted by the United States in 2022 due to concerns about technology diversion to Huawei Technologies.
The capital raised by Changxin Xinqiao from the Big Fund is part of a larger registered capital expansion that involves existing investors, Changxin Xinan and Hefei Xinyi, increasing their capital contributions. Hefei Xinyi is backed by investment platforms associated with the state asset regulator in Anhui province.
The Big Fund was established in 2014 to accelerate China's semiconductor industry, which lags behind the United States, Taiwan and South Korea. It raised £19 billion for its first fund and £28 billion for its second fund. The fund aims to raise approximately £29 billion in another round as China intensifies its efforts to catch up with global rivals.
Please note that Changxin Xinqiao and the Big Fund did not provide immediate comments on the investment.
China's state-backed chip investment fund has invested £2 billion in memory chip company Changxin Xinqiao.
The investment aims to support the establishment of a manufacturing base for 12-inch memory wafers and integrated DRAM design and manufacturing.
The Big Fund previously invested £13 billion in Yangtze Memory Technologies.