TCL Technology Completes Acquisition of Zhonghuan Electronics and Information Group

PVTIME – TCL Technology, a Chinese manufacturer of TVs and display panels, announced yesterday that it has completed the acquisition of Zhonghuan Electronics and Information Group for the price of 10.974 billion yuan.

As previously reported, TCL Technology (000100. SZ) announced on June 24 that its board of directors had deliberated and approved the company’s participation in the bidding for 100% equity of Zhonghuan Electronics Information Group as the intended transferee.

Zhonghuan Electronics and Information Group’s core assets include two listed technology companies on the Shenzhen Stock Exchange: Tianjin Printronics Circuit Corp., a producer and developer of printed circuit boards, and Tianjin Zhonghuan Semiconductor Co., a manufacturer of photovoltaic monocrystalline silicon wafers and semiconductors.

Zhonghuan’s advantages and development plan in semiconductor materials production are important reasons why TCL Technology chose to acquire it. TCL Technology said in the announcement that Zhonghuan’s commitment to independent innovation and the development of semiconductors and new energy materials are in line with TCL’s strategic direction and industrial development outlook, making it a logical acquisition target for TCL’s strategic advancement goals.

In the field of semiconductor materials, the silicon wafer is a key material in the manufacturing of semiconductor devices. According to SEMI statistics, more than 95% of semiconductor devices and more than 99% of integrated circuits in the world use silicon as substrate material. According to CSCI, silicon wafers are developing towards larger sizes in order to adapt to the progress of the chip manufacturing process. The larger the silicon wafer size, the lower the unit chip manufacturing cost, and the less silicon chips are wasted.

Currently, the 12-inch (diameter) M12 silicon wafer is the mainstream size of the world, and its shipments account for about 63% of the total shipment of silicon wafers, followed by the 8-inch wafer which accounts for about 26%. The 18-inch silicon wafer is the next goal of silicon wafer development, but is not expected to be ready for mass production until after 2020.

8-12 inch large-diameter silicon wafers are the breadwinners for Zhonghuan’s semiconductor business. At the end of 2017, Zhonghuan’s ‘s large-scale silicon wafer project for integrated circuits began. Last year, the project was successfully put into operation. According to the 2019 financial report, the project is estimated to generate 21.4 billion yuan in revenue in 2020.

Currently, Zhonghuan has three 8-12 inch silicon wafer and 12 inch test line projects for integrated circuits under construction and has said that it hopes to become one of the leading semiconductor material suppliers in the world within three to five year.