SMIC: Consolidation Ahead 中芯国际任命新高管 或有助於业内合并

The situation at SMIC (HKEx: 981; NYSE: SMI), China’s leading microchip maker, seems to finally be nearing resolution with the announcement that David Wang had resigned as CEO and is being replaced by Zhang Wenyi, who will fill the position on an acting basis and will also become SMIC’s new chairman after the the previous chairman’s death 3 weeks ago. (company announcement) I would expect to see a permanent new CEO named in the next few months, but what’s most interesting here is Zhang’s background: specifically his position as chairman of Huahong Group. (English article; Chinese article) Industry followers will know that Huahong is parent  of another chipmaker, Sino-Japanese joint venture Huahong NEC, which has struggled for years due to lack of scale and in the past was the frequent subject of merger talk with SMIC or venture-backed Grace Semiconductor, another smaller struggling player. In fact, David Wang was a former CEO of Huahong NEC, but was clearly only an executive at the company and probably had little clout to pursue an acquisition of his former company after arriving at SMIC in late 2009. Zhang, on the other hand, as chairman of both SMIC and Huahong, is in a perfect position to push such consolidation, and perhaps even bring Grace into the mix, as that company’s stakeholders have long wanted to sell off the investment. If all goes according to plan, I would expect to see SMIC merge with Huahong NEC in the next 12 months, and perhaps also with Grace during that time, to create the world’s clear number-three contract chipmaker. Handling such a difficult merger would be tough for the most experienced of executives, and will be even more difficult for whoever SMIC names as its new CEO. For that reason, I’d look for lots of problems with this company over the next two years, and high volatility in its share price as it seeks to find its new footing.

Bottom line: SMIC’s naming of new top management will bring its leadership crisis closer to resolution, but look for volatility in the next two years with an upcoming industry consolidation.

Note: For a more in-depth commentary I’ve written for the Global Times on the upheaval at SMIC, please click on the following link: SMIC Commentary

中芯国际近日发布公告称,王宁国(David Wang)已辞去CEO职务,张文义将出任主席兼代理CEO,公司管理层危机看似最终找到解决方案。我预计,几个月内中芯国际将任命正式的首席执行官。这其中最值得玩味的是张文义的背景,尤其是其作为华虹集团董事长的这一身份。华虹集团是另一家芯片制造商华虹NEC的母公司。因缺乏规模效应,该公司多年来一直困难重重,外界过去常常猜测该公司将与中芯国际或上海宏力半导体合并。事实上,王宁国以前曾担任华虹NEC的首席执行官,但实际上只是这家公司的一名高管,在2009年底加入中芯国际後,他对收购华虹NEC似乎没太大影响力。相反,作为中芯国际和华虹的主席,张文义是推动整合的完美人选,而且甚至还可能将上海宏力半导体也纳入其中,因为上海宏力半导体的股东一直希望能卖掉手中的股份。如果一切按计划进行,我估计未来12个月将可以看到芯国际和华虹NEC合并,可能同时也会和上海宏力半导体合并。对於公司高管来说,合并事宜操作起来将颇为艰难,对於未来的中芯国际CEO来说,可能更是如此。我估计这家公司在未来两年里会面临很多问题,股价会有很大波动。


Related postings 相关文章:

SMIC Transition Begins, Instability Ahead 中芯国际高层大动荡 公司或将陷入混乱

SMIC Rumbles with Talk of Leadership Change 媒体风传中芯国际领导层变动

SMIC: Forging a Better Future?

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