KUALA LUMPUR: Dagang NeXchange Bhd (DNeX) completed a 60 per cent equity interest in SilTerra Malaysia (SilTerra) from Khazanah Nasional Bhd in a deal that was finalized today.
Group managing director Tan Sri Syed Zainal Abidin Syed Mohamed Tahir said the company's entry into the semiconductor market is timely, given the current global chip shortage affecting the delivery of automobiles and home appliances, notebooks, smartphones, and video game consoles, among other products.
"We expect demand to continue to rise beyond 2024 driven by the growing adoption of 5G wireless technology, industry revolution (IR) 4.0, Internet of Things (IoT), cloud computing and electric vehicles," said Syed Zainal.
DNeX's acquisition of the 60 per cent stake in SilTerra is valued at RM168.3 million and will be satisfied entirely by cash.
CGP Fund owns the remaining 40 per cent stake in the nation's largest chipmaker.
Moving forward, Syed Zainal said the company would focus on strengthening SilTerra's fundamentals in terms of plant utilisation and cost optimisation while introducing a vast network of global clientele.
"With our focus on the adoption of the latest semiconductor manufacturing technology, we expect to set in motion a positive spill-over effect throughout the semiconductor value chain in Malaysia comprising companies involved in product design, manufacturing, packaging and assembly.
"We are confident that this will, in turn, strengthen Malaysia's position in the ever-evolving digital arena," he said.
SilTerra is involved in the manufacturing of semiconductor wafers and supplies multinational fabless and integrated device manufacturer companies.
DNeX and CGP Fund plan to pursue various initiatives that will upgrade SilTerra's equipment and manufacturing capabilities in new technologies, increase the utilisation of SilTerra's foundry while at the same time optimise better product mix, as well as improve sales margin, which in turn is expected to drive the turnover and enhance the earnings potential of SilTerra.