ASMPT Announces Strategic Joint Venture To Accelerate Its Materials Business

July 30, 2020 - 09:30
ASMPT Announces Strategic Joint Venture To Accelerate Its Materials Business

Charting a Bright Course for the Future


HONG KONG, CHINA - Media OutReach- 29 July 2020 - ASM Pacific TechnologyLimited ("ASMPT" or the"Group") (Stock code: 0522) has announced that it reached an agreement to form aStrategic Joint Venture ("SJV") involving its Materials segment with key partners.


Mr. Robin Ng, CEO, ASMPT, said "We have been closely monitoring the markettrends of the lead frame business for some years and have observed industry consolidation amongstits market participants. Our Materials segment is consistently among the toplead frame manufacturers globally. It continues to be a strong business, intandem with the growth of the global semiconductor market. However, the leadframe business is extremely competitive and requires economies of scale inorder to be sustainably successful. This Strategic Joint Venture enables our Materials segment to prepareits business for the future, benefitting its employees, its customers and theGroup."


Mr. Ng added that ASMPT had undertaken arigorous process to identify suitable strategic partners to help accelerate thebusiness growth of its Materials segment. The SJV partners, namely Wise Road Capital Ltd ("Wise Road"), Asia-IOCapital Management Limited ("Asia-IO") and ASMPT, will collectively guide themanagement and development of the SJV.


The SJV is expected to begin operating by theend of the year.   In themeantime, ASMPT's Materials segment will continue itsbusiness, with the management team, operations, expansion plans and productdevelopment unchanged. When the SJV begins operation, it will operate as anindependent business under the auspices of the SJV partners, tapping the deepand complementary network and market experience of Wise Road and Asia IO to helpextend and solidify its leadership position in the lead frame market. ASMPT willhold a minority equity interest in the SJV amounting to44.44%, while Wise Road andAsia-IO will collectively hold a controlling interestof 55.56% through their designated investment vehicles. The financialsof the SJV will be equity accounted by the Group once the SJV begins operating.


"T he excellent track record, financial strength, andcollective attributes of the partners in this Strategic Joint Venture form a very strong and capable foundation to fully actualizethe immense potential inherent in the lead frame business. This will benefit all the stakeholders in ASMPT'sMaterials segment, and give our customers the assurance that theirneeds and future requirements are well looked after," concluded Mr. Ng.


"FITA is verypleased to form a strategic partnership with ASMPT and supports its StrategicJoint Venture with Wise Road Capital and Asia-IO. Wise Road Capital is one ofthe key investment platforms in FITA. Through our strong alliance member networkof more than 100 leading high-tech players in China and the world, we areconfident that FITA can provide a strong synergistic support to this StrategicJoint Venture and propel the growth of the business," said Mr. Brighten Li, Chairman of the Financial andInformation Technology Alliance (FITA).


"ASMPT is aworld class leader in the semiconductor value chain and we have full confidencein the technology, quality and operations leadership of ASMPT's MaterialsSegment. Wise Road Capital's senior management team brings a good combinationof finance expertise and industry expertise to support the success of theStrategic Joint Venture. We believe that the additional financial resources andindustry network the new shareholders will bring in, plus a sharp focus on growingthe Materials business together with ASMPT, will bring the success of theStrategic Joint Venture to the next level," said Mr. Fai Yeung, Managing Partner of Wise Road Capital.


"ThisStrategic Joint Venture corroborates our strategy to back a high-quality playerthat is investing to become an even strongerplayer in the industry with a larger market share whenthe market upcycle resumes," said Mr.Denis Tse, Managing Partner of Asia-IO.