"Japanese Sovereign Wealth Fund Plans to Acquire Semiconductor Material Companies"
Japanese Government Interpreted as Willing to Expand Semiconductor Investment
Japan's sovereign wealth fund, the Japan Innovation Corporation (JIC), is set to acquire Japanese semiconductor materials company JSR for about 1 trillion yen (approximately 9.1 trillion won), Nikkei reported on the 24th. This move is interpreted as part of the Japanese government's efforts to expand investment in the semiconductor sector.
According to the Nikkei report, JIC plans to initiate a public tender offer for JSR shares as early as this year, and if the process proceeds smoothly, it aims to delist JSR next year. Nikkei stated that JIC set the purchase price higher than JSR's market capitalization (about 670 billion yen) due to its high evaluation of JSR's potential and growth prospects.
To finance this, JIC will invest 500 billion yen (approximately 4.6 trillion won) and borrow 400 billion yen (approximately 3.6 trillion won) from Mizuho Bank. The remaining 100 billion yen (approximately 900 billion won) will be raised from other banks.
JSR is the world's leading company in photoresist, a photosensitive material used in high-density integrated circuits, holding a 28% market share. Photoresist is one of the core materials in semiconductors. In 2021, JSR acquired a U.S. company that develops and manufactures photoresist for about 45 billion yen (approximately 4 trillion won) and has focused on the semiconductor business by selling its traditional synthetic rubber division.
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JIC's acquisition of JSR is seen as reflecting the Japanese government's intention to increase investment in the semiconductor sector. Nikkei reported that JIC unusually negotiated directly with JSR without a public bidding process, and that the Japanese government has been supporting JIC's acquisition of JSR from an economic security perspective. On the 16th, the Japanese government also decided at a Cabinet meeting to expand the manufacturing base of semiconductors, a strategic material for Japan, and to foster talent.
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