GlobalWafers Falls Short in Late Push to Save Siltronic Deal

(Bloomberg) -- GlobalWafers Co. failed to reach a breakthrough in a last-ditch bid to salvage its planned takeover of Siltronic AG, likely spelling the collapse of the $5 billion deal. 

At a closed-door meeting between GlobalWafers Chief Executive Officer Doris Hsu and Deputy Economy Minister Udo Philipp, the Taiwanese technology company didn’t resolve the government’s concerns, according to people familiar with the matter. Siltronic shares tumbled as much as 4.7% on the news, extending the stock’s decline for the year to more than 20%.

While the ministry continues to examine the deal, it likely won’t approve it by Monday night, when a deadline for GlobalWafers to get all necessary approvals ends, said the people, who asked not to be identified because the information is private.

Spokespeople for GlobalWafers and Siltronic declined to comment. A spokesperson for the Economy Ministry said the review is ongoing, declining to comment further.

The meeting was likely the Taiwanese firm’s final opportunity to convince Germany to back the deal. The company had already offered the government special voting rights via a “golden share” as well as ways to undo the purchase or sell back key assets in Munich-based Siltronic.

GlobalWafers said on Thursday the deal still had a chance to be approved as legal options remain available to address any concerns. The statement came a day after Bloomberg reported that Germany is likely to allow a Monday deadline lapse without granting approval, a move that could derail the proposed deal.

Global chip takeovers have faced increasing headwinds as governments have begun to treat semiconductor technologies and supply chains as national-security issues. Authorities were put on heightened alert after a prolonged shortage of microelectronics roiled the auto industry and undermined post-Covid economic recoveries.

Nvidia Corp. is preparing to abandon its purchase of British chip company Arm Ltd. from SoftBank Group Corp. after drawing backlash from regulators and making little to no progress in winning approval for the $40 billion deal, Bloomberg reported this week. During the process, Nvidia’s bid faced a national security review in the U.K.

Other deals, however, have managed to win approval. Chinese regulators signed off on Advanced Micro Devices Inc.’s purchase of Xilinx Inc., clearing the way for one of the largest deals in the global semiconductor industry.

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