LONDON—The U.K. government on Wednesday began a national-security probe into a Chinese-controlled company’s purchase of a British computer-chip factory, a move that could lead it to unwind the deal almost a year after it was completed.
The scrutiny is the latest sign that countries are becoming increasingly protective of their semiconductor industries amid a global chip shortage.
“We welcome overseas investment, but it must not threaten Britain’s national security,” Britain’s business secretary,
Kwasi Kwarteng,
said Wednesday in a tweet announcing the move.
The probe centers on Nexperia’s roughly £63 million—about $79 million—purchase of
a manufacturing facility in Wales, which was completed in July 2021. Mr. Kwarteng now has 75 working days to decide whether to undo the deal. Nexperia, based in the Netherlands, is a subsidiary of China’s Wingtech Technology.
A spokesman for Nexperia said the company welcomes “this opportunity to engage and contribute to an informed debate about our U.K. activities and investment plans.”
The Newport Wafer Fab produces big wafers that eventually get chopped up and programmed into microprocessors. Nexperia has said it doesn’t pose a national-security risk because it produces simple chips that go into everyday items like hair dryers and vacuum cleaners. Some British lawmakers, who have lobbied U.K. ministers to unwind the deal, believe that the facility is integral to the U.K. semiconductor industry and could eventually help make Britain a technological leader in certain chip niches.
The deal is one of the first major test cases of Britain’s National Security and Investment Act, which went into effect earlier this year. It created a process similar to that of the Committee on Foreign Investment in the…
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