In a letter issued by Aixtron, it assured clients that it would remain a German company, protect its patents, and highlighted the benefits the potential acquisition deal with Fujian Grand Chip Investment Fund (FGC) would have on its future business strategy.

FGC’s 100% wholly owned German subsidiary Grand Chip Investment (GCI) offered to purchase a majority stake in Aixtron at a price of EUR 6 per share on Monday, which brings the estimated transaction value to EUR 670 million. This is higher than earlier Bloomberg report predictions that GCI would acquire the company at a rate of EUR 5.5 per share, which would have amounted to EUR 620 million.

Aixtron letter to clients stated: “FGC shares the vision to further develop AIXTRON to become one of the top players in the semiconductor industry. This transaction will bring many opportunities for all of us.”

The company expects the financing from GCI would drive the company’s products market entry, while the company would be able to maintain its existing technology hubs in Germany, UK, and U.S. and further strengthen its technology and IP portfolio. The company will retain its IP portfolio after the merge, and remain headquartered in Germany.

 “Aixtron will remain a German company with its legal domicile and its headquarters in Herzogenrath, Germany,” the company stated.

According to LEDinside observations, since German investment laws does not distinguish between domestic and foreign investments, GCI’s proposed acquisition has a high chance of being approved by the German government.

The crucial part of the acquisition will be whether the majority of shareholders, who combined have a total stake of at least 60% shares will approve the acquisition. Based on Aixtron’s data presented in its annual financial report for 2015, the company’s top six shareholders each have less than 10% stake in the company, and combined have less than 29% stake in the company. This might complicate the voting process, since it will involve the consent from a large number of investors to reach the minimum approval threshold of 60% outstanding shares.

(Aixtron's shareholder structure as of 2015. Source: Aixtron Annual Financial Report 2015, organized by LEDinside)

Nevertheless, for Aixtron the FCG’s investment will be vital for it to further develop into a top player in the semiconductor industry, and for the time being there seems to be minimal disruption in the company structure, operations, and patent portfolio.

 (Author: Judy Lin, Chief Editor, LEDinside)