The sale of British semiconductor firm Newport Wafer Fab to a Chinese-owned company has fallen through after the government stepped in to block the deal.
Back in July of last year, Nexperia, a company said to be linked to the Chinese Communist Party, sealed a £63m deal to take its total shareholding in Newport Wafer Fab to 100 per cent.
Now however, business secretary Grant Shapps put the buffers on the sale due to concerns over national security.
The government has issued a ‘Final Order’ which forces Nexperia to sell at least 86 per cent of its Newport Wafer Fab shares.
The move was led by business secretary Grant Shapps, who said the sale had the potential to ‘undermine UK capabilities’.
Bosses at the microchip company have reacted with shock and say that jobs, and taxpayers’ money, could now be at risk.
The south Wales-based company is one of the UK’s largest producers of semiconductors at a time when the global shortage continues to wreak havoc with new car supply.
A spokesman for the outfit said: ‘The UK government chose not to enter into a meaningful dialogue with Nexperia or even visit the Newport site.
‘More than 500 employees in Newport also raised their own significant concerns about such a divestment – the government has chosen not to listen to them and instead taken this decision which puts the livelihoods of them and their families, as well as more than £100m of taxpayers’ money, completely unnecessarily at risk.’
In response to the government intervention, the China Research Group of Conservative MPs said: ‘Our long-term security relies on the resilience of our economy and that means ensuring we don’t allow strategic assets to fall into the hands of authoritarian powers for the sake of short-term advancement.
‘We are sure many will be relieved that we aren’t handing over critical security infrastructure to a company with well-documented links to the Chinese state.
‘This decision should mark the beginning of delivering on policies that strengthen British national security and protect our leading tech companies and research from falling into the hands of our competitors.’