(Bloomberg) -- Chinese-owned Nexperia BV’s acquisition of chip firm Nowi Energy BV won approval from the Dutch government, which has been probing it on national security grounds.
The Netherlands deemed Nowi’s technology not a threat to national security because it’s not dual-use, Dutch Economic Affairs Minister Micky Adriaansens said in a letter to parliament on Monday, confirming an earlier Bloomberg News report. The move signals that the Netherlands is still open to business with China after a series of US-led export control measures against the world’s second-biggest economy.
Earlier this year, Dutch authorities used new legislation to start a probe into semiconductor maker Nexperia’s acquisition of Netherlands-based Nowi. The new law gave the government the power to stop foreign takeovers of Dutch companies on national security grounds.
Nowi, which produces small chips that make it easier for companies to power their devices with energy harvesting, was bought by Nijmegen-based Nexperia in November 2022. Nexperia was sold to Chinese investors in 2018, when Wingtech Technology Co. acquired the Dutch chipmaker for 25.2 billion yuan ($3.5 billion).
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The Netherlands has been rethinking its ties with China, one of its biggest trading partners. Earlier this year, the Dutch government agreed to join the US effort to further restrict exports of chip technology to China.
“At the moment, Russia and China” are among countries the Netherlands needs to be “extra alert” about, Adriaansens said in an interview with Bloomberg in May. There are many areas where Dutch companies can do business with China but in some fields, including photonics, quantum, radar technology, sensor technology and chips, “we are really vulnerable,” the minister said.
Wingtech took control of the company by consolidating a slew of stakes in Nexperia, which had been hived off from NXP Semiconductors NV to a consortium of Chinese investors.
Last year, the UK, citing national security concerns, ordered Wingtech to undo its acquisition of Britain’s biggest microchip factory more than a year after the deal closed.
The Investments, Mergers and Acquisitions Security Test Act, which enabled the Dutch government to limit the size of investments or block a deal on the basis of national security, covers takeovers that occurred since September 2020. The legislation wouldn’t allow the government to investigate Nexperia’s takeover by Wingtech.
(Updates with Dutch economy minister’s statement in the second paragraph)
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