Hon Hai and YAGEO to jointly participate in XSemi’s capital increase for a private placement in Taiwan MOSFET leader APEC


Hon Hai Technology Group (TWSE: 2317 TW; “Hon Hai”) and YAGEO Group (TWSE: 2327 TW; “YAGEO”) today jointly announced to participate in XSemi Corporation (“XSemi”)’s NT$3.1 billion capital increase. XSemi together announced to participate in the NT$2.8868 billion private placement in the leading Taiwan MOSFET manufacturer Advanced Power Electronics Corp. (TWSE: 8261 TW; “APEC”), becoming the largest shareholder with 35 million shares, or 30.08% of the company. After this round of the financing, Hon Hai will become the majority owner of XSemi with 51% of the shares, and YAGEO and its related companies will have 49%. The rest of the proceeds will be used for XSemi’s cash for operation. At the same time, Hon Hai’s Chairman Young Liu and YAGEO’s Chairman Pierre Chen are nominated to become XSemi’s Chairman and Vice Chairman, respectively, effective as of today.


XSemi is a Hsinchu based joint venture established in the third quarter of 2021, between the largest EMS in the world Hon Hai and the global leading electronic component solution provider YAGEO. It is an IC design company specializing in analog and power semiconductors, primarily focusing on the automotive and industrial industry. The goal of the joint venture is to serve the strategic system customers and distributors around the world for both Hon Hai and YAGEO. Hon Hai has more than 40% market share in EMS in the world, and most of the large system companies are Hon Hai’s customers. YAGEO is the only top global passive component solution provider with a leading position in all of resistors, capacitors, and inductors, and its premium distribution channel has the most extensive reach with very high market penetration. These customers of both Hon Hai and YAGEO make up for a strong demand of analog and power semiconductors, and this is one of the key value propositions of XSemi. XSemi is currently leveraging off its internal design capabilities and strategic alliances with many semiconductor leaders in the industry on product designs, capacity planning, distribution channels to enhance XSemi’s product portfolio and market position in analog and power semiconductors. With the strategic collaboration with APEC, XSemi will be able to expedite its business development process and strengthen its ability to provide customers with a steady, highly reliable, comprehensive product solutions and services.


Since 2020 before the formation of the joint venture in 2021, the world has seen an unprecedented market dynamics in the semiconductor world, driven by the combination of short-term supply shocks and rising secular demand. New market opportunities like EV, digital health, robotics, and work-from-home continue to emerge. Leveraging off the strategic collaboration with APEC for its comprehensive MOSFET product line with over 1,000 SKUs, XSemi will be able to expedite its business development process and strengthen its product portfolio and customer reach. APEC’s products will also complement highly with XSemi’s internally developed power management IC, SiC chips and modules as total solutions to provide to not only Hon Hai and YAGEO’s existing and future customers but will also benefit APEC’s current customers greatly. Moreover, APEC will benefit from Hon Hai’s EV business and YAGEO’s premium channels to enter the automotive supply chain, to capture more and greater growth opportunities.


“Semiconductor has been one of the three key technology pillars of Hon Hai. To meet the strategic development of 3+3, in the past year we have sped up our progress in semiconductor through Hon Young’s SiC fab and the BOL (Build-Operate-Localize) model to push for fab capacity partnerships and collaborations with automotive players on MCU and SoC. On top of XSemi’s participation through its analog and power products on the auto collaborations, its power module has also shown great progress. With the private placement of APEC, XSemi will be able to fill the gap in its low to high voltage silicon MOSFET product line, and this will provide steady semiconductor supply for the two groups’ future strategic focus in industrial and automotive” said Hon Hai Chairman Young Liu.


“Our alliance with APEC is to capture the upcoming opportunities in analog and power semiconductors. Once the products are ready, we believe that we can quickly deliver them to the customers through YAGEO’s extensive global channels. This approach fits YAGEO’s strategy perfectly which is to continue to provide our global customers with comprehensive electronic component solutions” said YAGEO Chairman Pierre Chen.


Building on top of Hon Hai and YAGEO’s long term strategy and objectives, XSemi will continue to expand its product portfolio and strengthen its product competitiveness to meet the needs of the existing and future customers of the two groups. XSemi aims to be one of the key global analog and power semiconductor providers.