What’s Going on with Magnachip Semiconductor Corporation?
On Sept. 13, 2021, the Department of Treasury on behalf of the Committee on Foreign Investment in the United States (CFIUS) gave Magnachip Semiconductor Corporation (MX) — formed by an affiliate of Chinese private equity firm Wise Road Capital LTD — permission to withdraw and re-file a merger notice. The notice is in regards to Magnachip Semiconductor Corp’s proposed merger with Michigan Merger Sub, Inc. Yesterday, Sept. 13, MX stock closed at $17.34, which is a 0.23% increase in value per share.
What Does This Mean for MX?
On August 27, 2021, outside legal counsel for both companies involved in the proposed merger received a letter from the Department of Treasury on behalf of CFIUS “indicating that CFIUS has identified risks to the national security of the United States arising as a result of the Merger.”
As a result of this letter, Magnachip Semiconductor Corp, via legal counsel, requested that CFIUS permit them "to withdraw and re-file their June 11, 2021 notice concerning the Merger, in order to permit further discussion with CFIUS concerning potential options for permanently mitigating risks to the national security that have been identified by CFIUS.”
On September 13, 2021, CFIUS notified the parties that CFIUS had granted the merger withdrawal and re-file request. A new CFIUS review period for this proposed merger will begin on September 14, 2021, and “conclude no later than October 28, 2021.”
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MagnaChip Semiconductor Corp designs and manufactures analog and mixed-signal semiconductor platform solutions for communications, Internet of Things applications, consumer, industrial and automotive applications. The company's product portfolio consists of large display solutions, mobile display solutions, sensor solutions, LED solutions, mobile solutions, and power conversions. The company operates in two segments namely Transitional Fab 3 foundry services and Standard products business. It generates maximum revenue from the Standard products business segment. Geographically, it derives a majority of revenue from the Asia Pacific.
