SMIC Clears Final Regulatory Hurdle to Take Full Control of SMNC

• Transaction value: The 49% stake is valued at approximately 40.6 billion yuan (about US$5.97 billion), based on the assessed equity value of the subsidiary.

• Issue price: The newly issued shares will be priced at 74.20 yuan per share.

• Lock‑up requirement: The shares received by the selling shareholders will be subject to a 12‑month lock‑up, meaning they cannot be sold immediately after issuance.

Several of the selling investors include major Chinese semiconductor investment vehicles, such as the National Integrated Circuit Industry Investment Fund (often called the “Big Fund”).

Why the Deal Could Be the STAR Market’s Largest

At 40.6 billion yuan, the acquisition is large enough to potentially become the biggest merger and restructuring transaction ever conducted on Shanghai’s STAR Market, China’s technology‑focused stock exchange board.

The scale reflects both the value of SMNC’s manufacturing capacity and the importance of consolidating ownership within China’s domestic semiconductor supply chain.

Strategic Impact for SMIC

Full ownership of SMNC simplifies SMIC’s corporate structure and strengthens control over one of its key manufacturing bases in Beijing.

Industry observers note several expected benefits:

• Operational coordination: Integrating SMNC fully into SMIC’s corporate structure can streamline management and production planning.

• Manufacturing capacity integration: The move consolidates a major fabrication facility under SMIC’s direct control.

• Stronger market position: Owning the unit outright could improve efficiency and strategic flexibility as China’s semiconductor sector continues to expand.

The transaction also aligns with broader efforts in China’s chip industry to consolidate resources and strengthen domestic production capabilities.

What Happens Next

With the CSRC approval secured, SMIC can proceed with the share issuance and finalize the acquisition process. After completion, SMNC will operate as a fully owned subsidiary, marking a significant restructuring step for China’s largest semiconductor foundry and one of the biggest corporate deals on the STAR Market.