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The Jewel in the Crown

The beginning

After the rapid growth over the past decade, China’s IC industry shows a significant increase in its overall competence. Being one of the basic industries defined in the Made in China 2025 Initiative, the IC industry is embracing opportunities available under the National IC Industry Promotion Outline released last year and the Made in China 2025 Initiative recently announced. However, being the world’s largest and fastest-growing IC market, homegrown IC products account less than 10% of the domestic market. China is still largely dependent on imports of IC products, especially at the top end of the market where foreign technology enjoys a dominant share.

RF power amplifier, being the “pearl in the crown” in the RF area, is one of the core radio communication technologies. It is also a key component used for radar, electronic warfare, aerospace and satellite purposes. NXP RF Power is the second largest RF power amplifier suppliers in the world, reporting annual sales revenue of approx. US$ 400 million. The company’s customers include telecom giants, leading suppliers and military clients. 

Investment Cases of JIC

JIC’s role

Beijing Jianguang Asset Management Co. Ltd., a subsidiary of JIC member company JIC Capital, acquired NXP RF Power Division in a deal closed in December 2015. This US$ 1.8 billion transaction set a new record for China’s overseas IC acquisitions in 2015. It will help fill the gap in China’s high-end chip technology and in turn play a substantial role in the upgrading process of the entire semi-conductor industry. Involving a Chinese state-owned buyer, the transaction itself is the first IC spin-off deal that has been approved by CFIUS and FTC. 

"By leveraging the network and resources of Beijing Jianguang Asset Management Co. Ltd. in the industry, we as a genuine Chinese company will be able to expand our market coverage, provide the best support to our global customers and maximize our competitive advantages."

--- Frans Scheper, NXP Executive Vice President and General Manager of Standard Products Applications

"Beijing Jianguang Asset Management Co. Ltd. is looking forward to establishing a long-term partnership with NXP since the rapid growth of the joint venture will not only benefit both sides but also greatly contribute to the local industry and China`s economic development."

--- Sun Wei, General Manager of Beijing Jianguang Asset Management Co., Ltd.

At the end of 2015, a new company was established following the acquisition of NXP RF Power. NXP's management team, employees, production lines and its intellectual property rights and patents were kept intact, and transferred to the new entity. This very solid transition empowered the new entity with autonomy in management, and provided the necessary space for creativity for the R&D team in a sustainable way. In June 2016, Jianguang Asset Management and NXP reached another agreement on the acquisition of the NXP Standard Products business. The latter is a leading supplier in discrete, logical and Power MOS semiconductors, and targets various markets such as automobiles, industrial manufacturing, computing, mass consumers as well as wearable devices. Its customers include Apple, Nokie and Dell, among others. On February 7, 2017, NXP Standard Product Business M&A Project of Beijing Jianguang Asset Management Co., Ltd.(with Nexperia B.V. being established for the purpose of the project) was successfully delivered, the transaction amount of which was 2.75 billion dollars.

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