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my country's integrated circuits will usher in the "big test" of integration
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my country's integrated circuits will usher in the "big test" of integration

(Summary description)Recently, Tsinghua Holding’s Tsinghua Unigroup Co., Ltd. and RDA jointly announced that according to the merger agreement signed by the two parties in November 2013 and subsequent amendments to the merger agreement, the total value of Tsinghua Unigroup to RDA will be approximately The $907 million M&A transaction has been completed.

my country's integrated circuits will usher in the "big test" of integration

(Summary description)Recently, Tsinghua Holding’s Tsinghua Unigroup Co., Ltd. and RDA jointly announced that according to the merger agreement signed by the two parties in November 2013 and subsequent amendments to the merger agreement, the total value of Tsinghua Unigroup to RDA will be approximately The $907 million M&A transaction has been completed.

  • 2014-07-26
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hangshun
 
 

Recently, Tsinghua Holding’s Tsinghua Unigroup Co., Ltd. and RDA jointly announced that according to the merger agreement signed by the two parties in November 2013 and subsequent amendments to the merger agreement, the total value of Tsinghua Unigroup to RDA will be approximately The $907 million M&A transaction has been completed. Coupled with the acquisition of Spreadtrum Communications last year, Tsinghua Unigroup has become the largest communication chip design company in China, one step closer to its goal of building a world-class enterprise group in the field of semiconductor chips. Relevant experts believe that Tsinghua Unigroup's acquisition of Ruidike will greatly enhance the overall strength of my country's chip design industry, and even the first chip company in the mainland with a market value of over 100 billion yuan will emerge. Mergers and acquisitions will be the development trend of the chip design industry.

RADICO is a leading chip design company in China, focusing on the design, development and sales of wireless system chips and RF chips. The products are widely used in mobile communication, wireless connection, broadcast communication and other fields. Regarding the acquisition, Zhao Weiguo, chairman and president of Tsinghua Unigroup, said, "The acquisition is of great significance to both Tsinghua Unigroup and RDA, as well as China's semiconductor industry. The effective synergy between RDA and Spreadtrum will significantly improve domestic companies' market share. Global market position in the field of mobile communication chips. We look forward to working closely with RDA's excellent management team and staff to make due contributions to the development of China's integrated circuit industry."

It is reported that Ziguang Group plans to use 5 years to develop the Ziguang chip industry into a world-leading communication chip group, with 20,000 employees and revenue exceeding 10 billion US dollars.

The background of Ziguang's continuous mergers and acquisitions is that the Chinese government has set out to revitalize the semiconductor industry. For a long time, my country's integrated circuit industry has been controlled by foreign manufacturers, and integrated circuit products rely heavily on imports, which is difficult to form a strong support for building the core competitiveness of the national industry and ensuring information security. Data show that in 2012, the import dependence of my country's semiconductor chips was close to 80%, the import rate of high-end chips exceeded 90%, and the amount of semiconductor imports had exceeded the amount of oil imports. In 2013, my country's integrated circuit imports reached 231.3 billion US dollars.

In order to break the passive situation, the relevant departments issued the "National Integrated Circuit Industry Development Promotion Outline" in June this year, proposing that by 2020, the gap between the integrated circuit industry and the international advanced level will gradually narrow, and the average annual growth rate of the industry's sales revenue will exceed 20%. %, the sustainable development capability of the enterprise has been greatly enhanced. It is necessary to give full play to the role of the market mechanism to guide and promote the merger and reorganization of integrated circuit design enterprises.

It is understood that the semiconductor industry mainly includes design, manufacturing, packaging and testing and other links. In the past 10 years, driven by the dual driving forces of policy support and strong end market demand, the design industry has achieved sustained and rapid growth and has become the fastest growing link in the semiconductor industry chain. Subsequently, the growth focus of my country's semiconductor industry shifted to a production line-free design model. According to the statistics of China Semiconductor Industry Association, in 2013, the sales volume of China's integrated circuit industry was 250.851 billion yuan, a year-on-year increase of 16.2%, of which the design industry was 80.88 billion yuan, a year-on-year increase of 30.1%, much higher than the 19.9% ​​of the manufacturing industry and the 6.1% of the packaging and testing industry. %.

Although my country's integrated circuit industry has developed rapidly, due to the fact that the industrial layout has been too scattered over the years and the scale of enterprises is small, the total output value of the top ten domestic chip design enterprises is less than one-third of Qualcomm. Today, the merger and reorganization of Ziguang Group in the design industry will change this situation. Tsinghua Unigroup has acquired two of the top three chip design companies in China by acquiring Spreadtrum Communications, a communications baseband chip design company, and RDA, a communications chip design company.

In this regard, Zhang Ruo, a researcher at Shenyin Wanguo, believes that if Spreadtrum and RDA are successfully merged, then the combined revenue in 2013 will be US$1.42 billion, and Tsinghua Unigroup will surpass Huawei HiSilicon to become the largest integrated circuit (IC) design manufacturer in China. 11th in the world. The powerful combination of Spreadtrum and RDA will achieve complementary advantages. Spreadtrum software research and development strength is strong, but IC research and development strength is weak, RDA is stronger than IC research and development but lacks software development strength.

In addition to the three companies benefiting from mergers and acquisitions, China's semiconductor industry will also be greatly affected. "If the semiconductor industry wants to grow rapidly, mergers and acquisitions are a very important means." Gong Xiaofeng, director of the International Economic and Technological Cooperation Center of the Ministry of Industry and Information Technology, told reporters that the development of the integrated circuit industry requires a lot of funds. To seize the opportunity in the market, for example, a chip design company can only have enough anti-risk ability to achieve a revenue of 1 billion US dollars; and to improve technology, improve the quality of talents, and form a certain scale in a short period of time, mergers and acquisitions of existing advantageous companies are undoubtedly Effective Ways. "In the future, there will be more and more similar mergers and acquisitions in the field of integrated circuits." Gong Xiaofeng said.

"As for the Tsinghua Unigroup merger, it may force the integration of China's integrated circuit field to accelerate in the short term. In the medium term, it may affect the integration of upstream companies such as the manufacturing and packaging and testing of the integrated circuit industry, and in the long run, it will affect terminal manufacturers." Gong Xiaofeng added.

If the first shot was "capital operation" that triggered the quantitative change of the industry, then the integration of Spreadtrum and RDA's "industrial operation" will lead to a huge qualitative change in China's integrated circuit industry. Gu Wenjun, chief analyst of iSuppli Semiconductor, said, "The integration of Spreadtrum and RDA will kick off the great transformation of China's industry, and the chain reaction it will trigger will force the integration of my country's integrated circuit industry and even the mobile phone industry."

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