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Below are news flashes for the week starting December 25, 2023.

1. Japan earthquake: Toshiba, Murata and other semiconductor companies responded

A 7.6-magnitude earthquake occurred on the Noto Peninsula in Ishikawa Prefecture, Japan on the 1st. A tsunami of about 5 meters high has been observed near the epicenter. As of the 2nd, 55 people had died, affecting the transportation, manufacturing, and service industries, and also triggering global concerns about the semiconductor supply chain.

Toshiba said on January 2 that it had stopped production at a factory of its subsidiary Kaga Toshiba Electronics, which is Toshiba's main production center for power semiconductors. Toshiba said it has not yet decided when it will restart the plant.

Murata Manufacturing Co., Ltd. said on January 2 that it was assessing the damage to two infrastructure sites near the epicenter to ensure the safety of workers. Murata said no serious casualties or damage were found at its other 11 factories in Ishikawa, Fukui and Toyama prefectures.

Chip equipment manufacturer Kokusai Electric said it discovered damage at its factory in Toyama and is conducting further investigations and plans to resume operations on Thursday (January 4).

In terms of MLCC, TAIYO YUDEN's Niigata factory is a brand-new factory that can withstand earthquakes up to level 7, and the equipment is currently not affected.

Companies such as SUMCO also fell victim to the earthquake, but production levels were not affected on a larger scale.

2. China’s “first humanoid robot stock” UBTECH is listed in Hong Kong

On December 29, 2023, the last trading day of the year, UBTECH, a humanoid robot company headquartered in Shenzhen, was officially listed on the Hong Kong Stock Exchange, becoming China's "first humanoid robot stock".

The prospectus shows that this IPO of Ubisoft plans to issue 11.282 million shares, with an offer price of HK$86 to HK$116 per share, and a maximum fund-raising of approximately HK$1.309 billion. As of the lunch break, UBTECH's share price was HK$90.1 per share, up slightly by 0.11%, with a total market value of approximately HK$37.648 billion.

UBTECH has been established for more than 11 years. In 2014, it launched Alpha, a small humanoid robot, and in 2018, it launched the first-generation humanoid robot Walker. In 2019, UBTECH sought to be listed in China. After several setbacks, it submitted a prospectus to the Hong Kong Stock Exchange this year.

UBTECH has been raising external funds since 2013, and the investment team behind it is "star-studded". As of the first half of 2023, the company's founder and CEO Zhou Jian actually controls 52.59% of the company's voting rights and is the ultimate controlling shareholder. Tencent Holdings and Qiming Venture Capital both hold more than 5% of the shares, making them the first and second largest institutional shareholders. BYD co-founder Xia Zuo holds 5.63% of the shares. In addition, iFlytek, Minsheng Securities, CDH Investments, and Beijing Easyhome have also invested in Youbi. The prospectus disclosed that the total funds raised in the previous rounds of financing were approximately 5.61 billion yuan.

3. Pegatron loses control of its Kunshan factory and Luxshare Precision will take charge

Pegatron is losing control of its subsidiary PEGAGLOBE (Kunshan), and the new control will fall into the hands of Luxsan.

According to information released by the Taiwan Stock Exchange on December 28, PEAGLOBE (Kunshan) Co., Ltd. will raise a registered capital of approximately RMB 2.107 billion (equivalent to NT$9.479 billion) through a cash capital increase. All subscriptions will be provided to strategic Investor Luxsan Precision iTech (Kunshan) Co., LTD. (Luxun).

It is reported that Pegatron HOLDING LTD., a wholly-owned subsidiary of Pegatron, has 100% ownership of PEGAGLOBE through its 100% investment subsidiary ASLINK PRECISION CO., LTD. (hereinafter referred to as ASLINK). Once the transaction is completed, Pegatron's indirect shareholding ratio in PEGAGLOBE is expected to be reduced from 100% to 37.5%, which means that the former will lose control of the latter.

4. After burning through 35 billion yuan in financing, WM Motor’s bankruptcy and reorganization was accepted by the court

The Shanghai No. 3 Intermediate People's Court accepted Weimar Group's pre-reorganization application on October 7, 2023. During the pre-reorganization period, Weimar Group has completed audit evaluation, claims declaration, asset verification and other tasks, and has contacted multiple intended investors to achieve preliminary results.

According to data, WM Motor, which was once known as the "Big Three of the New Power" together with NIO and Xpeng Motors, was established in May 2012 with a registered capital of 6 billion yuan and is wholly owned by Suzhou WM Smart Travel Technology Co., Ltd. share. Currently, the company has information on multiple persons subject to execution, with the total amount being executed exceeding 87.71 million yuan. In addition, there are also information on multiple persons subject to execution for dishonesty, consumption restriction orders, and final cases. Data shows that WM Motor has received a total of 12 rounds of financing since its establishment, and the announced financing scale has reached a total of 35 billion yuan. It is one of the car companies with the most financing among the new forces of new energy vehicles . However, due to fierce competition in the new energy vehicle market, WM Motor has frequently reported salary cuts and production suspensions since the second half of 2022.

WM Motor pointed out that before applying for pre-reorganization and during the pre-reorganization period, it actively negotiated with stakeholders and negotiated with international and domestic intended strategic investors, and has achieved preliminary results. It is expected that during the reorganization process, by introducing the support of strategic investors, Weimar Group's product structure will be optimized and its business model will be upgraded during the transformation, in order to regain the ability to continue operating.

5. ASML statement: Partial license revocation affects a small number of Chinese customers

On January 1, ASML issued a statement on its official website stating that the Dutch government recently partially revoked the license for NXT:2050i and NXT:2100i lithography systems to be shipped in 2023, which will have an impact on a small number of Chinese customers .

The company noted that recent discussions with the U.S. government provided further clarification on the scope and impact of U.S. export control regulations. The latest U.S. export rules (issued on October 17, 2023) impose restrictions on certain mid-criticality DUV immersion lithography systems at a limited number of advanced production facilities.

On September 1, 2023, ASML stated in another statement that it had submitted an export license application to the Dutch government for TWINSCAN NXT: 2000i and subsequent immersion lithography systems. The Dutch government has also issued an export license as of September. The required license on the 1st allows the company to continue shipping related lithography systems through 2023.

In the above statement, the company said: "Under the new export control regulations, ASML can still fulfill the signed contract and ship these lithography equipment before the end of this year (referring to 2023). Customers are also aware of the export control regulations. Due to the upcoming restrictions, ASML will basically not obtain an export license to ship these devices to Chinese customers from January 1, 2024."

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