Chinese chipmaker to buy France’s Linxens

HONG KONG: China’s top state chip manufacturer Tsinghua Unigroup Ltd has signed a deal to acquire French smart chip components maker Linxens for about 2.2 billion (RM10.45 billion), five people with direct knowledge of the matter said.

The deal, which the sources said was signed over a month ago but has not yet been announced publicly, will be a key test of European regulators’ stance on Chinese investment in the region that has been on the rise amid the country’s worsening trade relations with the United States.

Tsinghua’s acquisition of Linxens from private equity group CVC is still pending regulatory clearance, three of the sources told Reuters, adding regulators in France, Germany and the company’s union need to approve the deal.

The authorities are not expected to object, the sources said on condition of anonymity as the information is confidential.

Tsinghua and Linxens did not respond to requests for comment.

According to three sources, Tsinghua has already locked in a deal with four banks for a

1.5 billion bridge loan to fund the transaction. Credit Suisse, a main lender in the loan, also advised the seller, the people said. Credit Suisse declined to comment. Linxens, headquartered close to Paris, has 535 million in annual sales and employs 3,500 staff at nine production sites globally. It also has offices in China, Singapore and Thailand.