A Look at Seven Listed Semiconductor Firms in China Backed by Huawei
In 2019, Huawei set up Shenzhen Hubble Technology Investment Partnership, an investment company which, to date, has invested in seven semiconductor companies that have gone on to be publicly listed. The names include silicon carbide chip maker SICC, base station chip manufacturer 3PEAK, small and medium-sized storage chip manufacturer Dosilicon, filter manufacturer Caiqin Technology, micro power semiconductor manufacturer Oriental Semiconductor, laser radar manufacturer Focuslight Technologies and Everbright Photonics.
Huawei Hubble’s semiconductor investment chain covers software, materials, equipment, design and sealing along with testing. One Chinese media outlet, IC Views, believes that Huawei’s investment in the semiconductor industry is to solve the company’s chip shortage crisis while investing in sodium batteries and lidar is to contribute to the company’s vehicle manufacturing business.
In July 2019, Hubble invested 72 million yuan ($10.12 million) in 3PEAK, a small analog chip maker that was struggling to survive. After Hubble took a stake in 2019, orders from Huawei contributed much to 3PEAK’s revenue. According to the prospectus, Huawei contributed just 1.7 million yuan, or 1.5 percent, of 3PEAK’s total revenue in 2018. In 2019, Huawei contributed 170 million yuan in sales of 3PEAK, accounting for 57.13% of total revenue.
The second Hubble-backed company that was successfully listed is Canqin Technology. Hubble invested 110 million yuan in the company in 2020, with a stake of 4.58%. At that time, Canqin was valued at 2.4 billion yuan, but is now worth 4.8 billion yuan.
In January 2022, SICC was listed on the Science and Technology Innovation Board in Shanghai. In August 2019, it received its first investment from Hubble totaling 110 million yuan. After multiple capital increases, Hubble’s final shareholding ratio stands at 6.3%.
Everbright Photonics is a lidar enterprise. At the end of 2020, Hubble became its shareholder by purchasing 5.065 million shares at 15 yuan per share. At present, Hubble holds 3.74% shares of Everbright Photonics, ranking as its seventh largest shareholder.
Hubble has also invested in some enterprises just before their debuted on public markets. In May 2020, Hubble invested in Dosilicon and, four months later, the company submitted its prospectus. In September 2020, Hubble paid 50 million yuan for 2 million shares issued by Focuslight Technologies, which was already in the IPO process. After the public listing, Hubble now holds a 2.22% stake in Focuslight Technologies.
Hubble became one of several new shareholders in Oriental Semiconductor in the 12 months before the IPO application was filed. In July 2020, Hubble added capital of 75.3 million yuan to Oriental Semiconductor, obtaining 7% of the equity, at a price of 22.61 yuan per share. Today, the company’s share price is 228 yuan.
SEE ALSO: Oriental Semiconductor Completes Shanghai IPO
Hubble’s support includes both cash and orders. 3PEAK, SICC, and Canqin Technology all received large orders from Huawei but all seven listed companies with Huawei’s backing are more or less dependent on the tech giant’s orders. Three of the seven companies spent less than the market average on R&D.
In addition to the listed companies, there are also quite a number of Huawei-invested enterprises in the process of IPO this year, such as Sidea Semiconductor, analog IC manufacturer Maxic Technology, semiconductor testing company Skyverse, and Ethernet chip company Motorcomm.
