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China Chipmaker SMIC Raises $2.25 Billion From State-Owned Funds

By Zhang Erchi and Mo Yelin / May 18, 2020 03:16 PM / Finance

Photo: VCG

Photo: VCG

China’s leading chipmaker Semiconductor Manufacturing International Corp (SMIC) has secured financing worth $2.25 billion from two state-owned funds to sharply boost capacity at its main Shanghai operation, the company said on Friday.

China IC Fund II and Shanghai IC Fund II are contributing $1.5 billion and $750 million respectively, the Hong Kong-listed company said in a statement filed to the bourse.

SMIC will use the money to ramp up chip production in its Shanghai factory. SMSC, the entity which operates the Shanghai facility, aims to increase its manufacturing capacity from 6,000 wafers per month to 35,000, according to the statement.

This is the second time SMIC has announced fundraising efforts since May. Early this month, the company announced that it was planning to raise over 20 billion yuan ($2.8 billion) through a listing on Shanghai’s Nasdaq-like STAR market. About 40% of the capital raised, or nearly 8 billion yuan, would be used for SMSC to increase production capacity, the company said at the time.

SMIC’s big ramp-up comes as China tries to become more self-sufficient in high-tech components like microchips, following recent efforts by the U.S. to limit access of such foreign-made products to Chinese manufacturers like Huawei.

Read the full story on Caixin Global later.

Contact reporter Mo Yelin (yelinmo@caixin.com)

Related: In Depth: Coronavirus Just the Latest Hurdle to Local Government’s Chipmaking Dreams


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