Chinese firm Nexperia hits back at claims takeover of Newport Wafer Fab 'gives control to China' 

A chinese-owned firm has said it is "surprised" and "disappointed" that a rescue bid of a Welsh semiconductor factory has become the focus of a political row about Chinese influence in the UK.

Nexperia, which is based in the Netherlands but owned by Chinese firm Wingtech, has taken over Newport Wafer Fab in a deal said to be worth £63m.

A senior figure at Nexperia told ITV News there are no security risks in the takeover, adding that it makes products used in everyday items like toasters, hair dryers and cars - and nothing connected to sensitive data or military use. 

It is that connection which has led to pressure on the UK Government to intervene in a similar way to the row over Huawei’s involvement in Britain’s mobile phone infrastructure.

The Commons Foreign Affairs Committee described the takeover as “the sale of one of the UK’s prized assets to a strategic competitor” and described Nexperia  as “a company heavily backed by the Chinese Communist Party."

In a Commons debate, the former Conservative leader Sir Iain Duncan Smith said the deal was part of “project kowtow” and should have been blocked.  

Iain Duncan Smith, who is against the takeover of Wafer Fab by Nexperia. Credit: PA Images

In the face of such pressure, the Prime Minister asked his National Security Adviser to conduct a review, but the UK Government has previously said that it sees no reason to intervene. 

The Welsh Government has welcomed the securing of 400 jobs but said that any security concerns are a matter for ministers in London. 

Charles Smit, who is a board member and General Counsel for Nexperia, told ITV News the company is "surprised and disappointed" at the row, insisting that the takeover gives the Newport factory a secure future. 

“The truth is that Newport Wafer Fab was almost insolvent at the beginning of this year, so even salary payment was at stake", he said.

"That is when we stepped in - and we basically found it necessary to rescue the company because we've invested already quite heavily. 

Newport Wafer Fab began life in the early 1990s as Inmos. It makes semiconductor wafers onto which tiny circuits are printed. The wafers go on to become microchips in factories in Asia.

And that is the stage of the process that Nexperia says it can give Wafer Fab access to.

Nexperia was owned by Phillips but since 2017 has been owned by Chinese businesses, most recently Wingtech. That has raised fears of it being controlled by the Chinese communist party.

Something Mr Smit says is not true.

Amid concern that the Chinese government could use the firms’ owners to gather information, Mr Smit said the company's products are the simplest semiconductors in the world, not something to be used to gain influence.

“Our products are the simplest semiconductors that exist in this world. I would call those Second Division soccer: our products are switches, basically, they switch electricity on and off…

"Very simple products, no software, no data, nothing in there that could manipulate things."

The takeover has now happened. The political row may be just that: a political row. But even with the claim and counterclaim, it is true that the Prime Minister’s National Security Adviser is reviewing the deal. 

Mr Smit said the company has nothing to fear from it. 

“I think it's not my task to comment on what the Prime Minister has done.

"We are confident that if there's an investigation, and people look at the facts, that we will pass the test, whatever the test will be.”

In response, a UK Government spokesperson said,  “We have considered this issue thoroughly, and will continue to monitor the situation closely. The National Security Adviser is reviewing this case and we will not hesitate to take further action if needed.

“We remain committed to the semi-conductor sector, and the vital role it plays in the UK’s economy.”