UKRI Denies Pulling Funding From Newport Wafer Fab Over Chinese Ownership Concerns

Updated UK Research and Investment (UKRI) has rejected reports it had, on instruction of UK government, cut financial support for Newport Wafer Fab over concerns about its acquisition by Nexperia, offering a simple statement: "funding continues."

The Telegraph was the first to report claims from an unnamed source that UKRI had pulled grant funding from Newport Wafer Fab earlier this week. The reason: concerns over the chip-making facility's acquisition by Nexperia, which while based in the Netherlands is owned by Wingtech Group - itself owned, in part at least, by the Chinese state.

UKRI, however, told The Register that the claims are incorrect, with a spokesperson setting the record straight with a simple two-word statement: "Funding continues."

That doesn't mean it will continue indefinitely, however. Earlier this month Prime Minister Boris Johnson pledged a national security investigation into the takeover of the facility, which employs 450 people.

Tensions are running high on the matter. "Given that this is an aggressive attack," Iain Duncan Smith, Conservative member for Chingford and Woodford Green, brought up during a Commons debate on the topic of state-sponsored cyber-attacks this week, "why are the government allowing the UK's largest silicon chip manufacturer, Newport Wafer Fab, to be bought by a Chinese firm when they know very well what they are up to?"

"My right honourable friend makes the point about Chinese investment, or Chinese purchasing - specifically Newport Wafer Fab - and that is a decision that the government are looking to review," James Cleverly, Conservative member for Braintree and Minister for State at the Foreign, Commonwealth, and Development Office, replied.

"We have considered this issue thoroughly, and will continue to monitor the situation closely," a government spokesperson confirmed to The Register. "The National Security Adviser is reviewing this case and we will not hesitate to take further action if needed. We remain committed to the semiconductor sector, and the vital role it plays in the UK’s economy."

The sale of Newport Wafer Fab to foreign investors comes as other nations, including Russia, India, and China, work to increase their native technology capabilities. It also follows on the heels of the 2016 sale of Cambridge-based low-power computing giant Arm to Japan's SoftBank - which it then turned around and sold to Nvidia.

When contacted for comment, Newport Wafer Fab asked that we speak to Nexperia. Nexperia, however, declined to provide a comment on matters of funding. ®

Updated to add at 11:29 UTC on 23 July 2021:

Nexperia has been in touch to say: "Our parent company is not Chinese state-owned as has been asserted. Wingtech Technology Co. Ltd is listed on the Shanghai Stock Exchange with a vast and diverse number of public shareholders.

"The entirety of Wingtech's issued share capital is listed on the Shanghai Stock Exchange, with only one class of shares in issuance. All shares have the same rights attached to them."