SAN FRANCISCO—A Chinese private equity firm has cut a deal to acquire Xcerra Corp., a Massachusetts-based supplier of semiconductor and electronics test equipment, for $580 million, Xcerra said Monday (April 10).
The deal is subject to closing conditions, including review by the Committee for Foreign Investment in the United States (CIFUS), a multi-agency U.S. government committee that reviews aspects of acquisition deals with an eye toward national security. A CIFUS review of the deal sets up a potential test for the U.S. government, which has grown increasingly wary of China's attempts to muscle into the semiconductor industry through acquisition of tech firms based in the U.S. and Europe.
Xcerra is the parent company of four brands that provide semiconductor and PCB test equipment. It was formed in 2014 when chip automatic test equipment (ATE) provider LTX-Credence acquired Everett Charles Technologies (ECT) in 2014 and Multitest from Dover Corp. in 2013.
Shortly before leaving office in January, former President Barak Obama made public a report by advisors and semiconductor industry insiders that warned of the threat posted to the U.S. semiconductor industry by China’s aggressive moves to become a global player in the chip space, including the acquisition of U.S. firms.
After a string of acquisitions and attempted acquisitions over the past two years, the deal announced Monday is the first significant attempt by a Chinese investment firm to acquire a U.S.-based semiconductor industry player since current President Donald Trump took office. One major deal, the proposed $1.3 billion acquisition of FPGA supplier Lattice Semiconductor Corp. by an investment firm partly owned by the Chinese government, remains in the review process. Lattice's CEO has said that deal, first announced last November, is "well underway" in the CIFUS review process.
Xcerra (Norwood, Mass.) said the deal announced Monday would entail its acquisition by an affiliate of Sino IC Capital Co. Ltd. known as Unic Capital Management Co. Ltd. Under the terms of the deal, Unic would acquire all outstanding shares of Xcerra for $10.25 per share, a 16 percent premium over Xcerra's average selling price over the past 30 trading days.
Xcerra's board of directors unanimously approved the deal, which is expected to close by the end of the year, the company said. Xcerra added that it expects no changes to the day-to-day operations of the company and expects that its existing management will continue to run the company.
Jun Lu, president of Sino IC Capital, said in a statement issued by Xcerra Monday that Sino is committed to keeping Xcerra's headquarters in Massachusetts. "We value the entire Xcerra team and are committed to keeping the company's headquarters in Norwood, Massachusetts," Lu said.
—Dylan McGrath covers the semiconductor industry and business news for EE Times.