China’s top chipmaker, SMIC (Semiconductor Manufacturing International), plans to raise 20 billion Yuan or roughly 2.8 billion US Dollars in Shanghai’s Star Market. The move arrives after the US attempts to hamper the growth of its rival tech companies.
Previously, SMIC had withdrawn its American depositary receipts or ADRs from the New York stock exchange back in 2019. Now, the company is planning on using the large proceedings raised for the Star Market to develop its latest 12 inch SN1 chip and bump its capital. For those unaware, the Star Market is China’s response to America’s Nasdaq, which was the birthplace of many tech giants.
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According to Zhou Ling, a fund manager with Shanghai Shiva Investment, “The Star Market is now playing its role as a strategic fundraising platform to bolster the country’s own technology companies as the US-China relationship worsens.” SMIC is Mainland China’s largest semiconductor foundry and a key chipmaker, raising the large sum to support itself better against US sanctions that aim to prevent China’s rise in the tech industry.
The semiconductor based company previously received major funding of 2.25 billion US Dollars back in May through Chinese state investors to help fund the expansion of its facility in Shanghai. It plans on raising its 14nm wafers production capacity from 6,000 to 35,000. This sizeable growth led the US Commerce Department to take drastic actions to stifle such growth, with an example being the cutting off of supply for chips from TSMC to Huawei. So, US sanctions could potentially still hamper operations for SMIC, but only time will tell how the US-China tech wars play out.
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(Via)
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