In a significant move highlighting China’s dedication to technological self-sufficiency, semiconductor start-up Changxin Xinqiao Memory Technologies, based in Hefei, successfully raised US$5.4 billion in its latest funding round. The funds were secured from government-backed investors, including the China Integrated Circuit Industry Investment Fund Phase II, underscoring Beijing’s commitment to achieving breakthroughs in the semiconductor industry and countering US sanctions.
Changxin Xinqiao, established in 2021, shares key shareholders and its general manager with Changxin Memory Technologies, China’s leading DRAM chip maker. The investment demonstrates Beijing’s resolve to bolster the nation’s semiconductor sector, aiming to compete with global industry giants such as Micron Technology and Samsung Electronics. Changxin Memory Technologies is gearing up for a significant move, planning to file for an initial public offering in China that could potentially value the company at over US$14.5 billion.
This strategic investment aligns with China’s broader focus on the semiconductor industry, which has gained momentum amid US efforts to restrict China’s access to cutting-edge chip technologies. Earlier successes were observed with companies like Huawei Technologies, which released a 5G phone featuring silicon produced by top Chinese chip maker Semiconductor Manufacturing International in August.
At the forefront of China’s semiconductor financing initiatives is the China Integrated Circuit Industry Investment Fund, commonly known as the Big Fund. Established in 2014, the Big Fund has attracted significant capital, totaling US$45 billion, and has supported numerous companies, including the US-blacklisted Yangtze Memory Technologies. Despite facing challenges due to a corruption probe, the Big Fund has ramped up its funding activities in 2023, making multiple investments, including the substantial backing provided to Changxin Xinqiao Memory Technologies.
This latest injection of funds underlines China’s steadfast commitment to achieving semiconductor excellence, fostering domestic innovation, and reducing reliance on foreign technologies in pursuit of technological independence.
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