Shanghai Boosts Chip Fund with US$1 Billion Amid Tech War
- tech360.tv
- Aug 20, 2024
- 2 min read
Shanghai Semiconductor Industry Investment Fund (SSIIF) doubles in size to US$2 billion. Capital boost aims to enhance China's semiconductor self-sufficiency. Shanghai commits to advancing chip technology through increased funding.
This move by the municipal government aims to bolster the local chip industry amidst US sanctions targeting the sector.
Raising 6.9 billion yuan (US$963 million) from investors, primarily state-backed companies in Shanghai, the SSIIF now stands at 14.5 billion yuan in capital. This increase is crucial for financing projects essential to China's goal of achieving self-sufficiency in semiconductor production, highlighting Shanghai's dedication to advancing chip technology.
Notably, the SSIIF is part of a series of funds established by local Chinese governments to enhance their chip sectors, including the national initiative known as the China Integrated Circuit Industry Investment Fund or the "Big Fund."
Shanghai Science & Technology Venture Capital Group remains the largest shareholder of the SSIIF with a 35% stake, followed by Shanghai Guosheng Group and Shanghai International Group, each holding an 18% stake. These entities are under the control of the local regulator of state-owned assets.
The fund's initial phase, dating back to 2016, directed significant investments into major chip foundries and semiconductor equipment manufacturers like Semiconductor Manufacturing International Corporation (SMIC), HLMC, and ACM Research Shanghai.
In May 2020, the second phase of the fund commenced with 5.4 billion yuan in equity investments from six backers, contributing to the fund's capital base reaching 7.6 billion yuan by 2022.
China's efforts to develop local semiconductor alternatives have been evident through substantial subsidies to domestic players, aiming to reduce reliance on foreign technologies due to export controls imposed by Washington.
The SSIIF II focuses on supporting significant semiconductor projects by key players like SMIC, Shanghai Optical Communications Corporation, Shanghai Hailinwei IC, and an automotive integrated-circuit company under JCET Group.
Moreover, the newly established Shanghai Integrated Circuit Parent Fund, positioned as a pilot fund to encourage private investments, is currently in the process of selecting sub-funds for investment opportunities.
Shanghai Semiconductor Industry Investment Fund (SSIIF) doubles in size to US$2 billion.
Capital boost aims to enhance China's semiconductor self-sufficiency.
Shanghai commits to advancing chip technology through increased funding.
Source: SCMP
