Apple Inc (AAPL)

[Investors3]

Apple supplier Foxconn backs top China chipmaker after $9 billion rescue
Wednesday, July 13, 2022 3:53 pm

A Shanghai-listed arm of Apple supplier Foxconn Technology Group acquired a stake in China’s top chipmaker during its $9 billion bailout, the latest in a series of investments the Taiwanese-run firm has made in the Chinese semiconductor industry, Bloomberg News reports citing “people familiar with the matter.”

Bloomberg News:

Foxconn Industrial Internet Co. invested in state-backed Tsinghua Unigroup through a fund it set up with investment house Wise Road Capital, according to people familiar with the deal. The fund paid about 5.3 billion yuan ($788 million) for a minority stake in Unigroup, one of the people said, asking not to be identified discussing a private deal.

The investment by the unit of Apple Inc.’s main iPhone assembler, known also as Hon Hai Precision Industry Co., could raise eyebrows as tensions rise between Beijing and Taipei over issues including technology and supply chain security. The deal requires a green light from Taiwan’s investment commission, which oversees sensitive deals, but Foxconn hasn’t submitted an application for approval, an official with Taiwan’s Ministry of Economic Affairs told Bloomberg News by phone.

Apple is considering new sources for the memory chips that go into iPhones, including its first Chinese producer of the critical component, to limit supply disruptions, Bloomberg News has reported. This year, it tested sample NAND flash storage made by Hubei-based Yangtze Memory Technologies Co., which is owned by Unigroup.

Memory is typically a gateway to more complex chipmaking because it requires production capabilities and heavy investment rather than the intricate designs needed for advanced processors and other logic chips. Washington is now considering leveling sanctions on Yangtze Memory, The Information has reported.

MacDailyNews Take: Oh what a tangled web we weave.

https://macdailynews.com/2022/07/13/apple-supplier-foxconn-backs-top-china-chipmaker-after-9-billion-rescue/