Semiconductor Manufacturing International Corp (SMIC, 中芯國際) shares plunged almost 10 percent after news emerged about the surprise resignation of a top executive who spearheaded the rapid technological ascent of China’s largest chipmaker.
SMIC is trying to reach co-CEO Liang Mong-song (梁孟松) after online media circulated a resignation letter they said originated with the industry veteran.
Liang quit after SMIC appointed a vice chairman without consulting him, reports said.
Photo: EPA-EFE
The company is attempting to clarify his intentions, it said in an exchange filing without elaborating. Liang could not immediately be reached for comment.
SMIC shares tanked more than 9.7 percent in Shanghai and Hong Kong, underscoring the executive’s pivotal role within a state-backed national champion trying to navigate a volatile US-Chinese relationship.
Liang handed in his resignation after learning about the appointment of Chiang Shang-yi (蔣尚義) — a former senior executive at larger rival Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) — to the board, media including Digitimes reported.
Liang, a fellow TSMC alumnus, was considered integral to SMIC’s efforts to become a major player in the business of fabricating chips for global giants.
SMIC has long relied on a cohort of Taiwanese executives — including Liang — to narrow the gap with TSMC and Samsung Electronics Co.
“SMIC’s recent technology progress was directly attributable to Liang,” Sanford C. Bernstein & Co analysts including Mark Li wrote. “Though the addition of Chiang is a positive, as the vice chairman his role is advisory. Liang, however, has been personally leading SMIC’s technology development and his contribution directly resulted in the mass production of 14nm [nanometers], for example. Considering them both, we believe Liang’s departure will have a bigger effect, and SMIC’s future technology progress may see a setback.”
Liang was instrumental in leading a 2,000-strong engineering team and helping SMIC migrate to cutting-edge 7nm process technology, slated to go into production in April.
It is unclear if his exit was directly linked to the appointment of Chiang, who left SMIC’s board last year to take charge of another signature Chinese project, memory chipmaker Wuhan Hongxin Semiconductor Co (武漢弘芯).
That company has since been taken over by the Hubei Provincial Government after encountering funding shortages.
SMIC, in contrast, has about doubled its market value this year, despite the risk of US sanctions, aided by a mega sale of stock in Shanghai and, more broadly, ballooning demand for chips as China’s economy emerges from the COVID-19 pandemic.
The Shanghai-based firm, a supplier to Qualcomm Inc and Broadcom Inc, lies at the heart of Beijing’s intention to build a world-class semiconductor industry and wean itself off a reliance on US technology.
It is backed by the China Integrated Circuit Industry Investment Fund (國家集成電路產業投資基金), as well as Singapore’s sovereign fund GIC Pte and the Abu Dhabi Investment Authority.
“Being a national champion with huge governmental investments, SMIC inevitably has some considerations that professional managers may not share,” Bernstein wrote. “Building a team that collaborates together toward a common goal is essential, but is something that money alone can’t buy.”
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) founder Morris Chang (張忠謀) yesterday said that Intel Corp would find itself in the same predicament as it did four years ago if its board does not come up with a core business strategy. Chang made the remarks in response to reporters’ questions about the ailing US chipmaker, once an archrival of TSMC, during a news conference in Taipei for the launch of the second volume of his autobiography. Intel unexpectedly announced the immediate retirement of former chief executive officer Pat Gelsinger last week, ending his nearly four-year tenure and ending his attempts to revive the
WORLD DOMINATION: TSMC’s lead over second-placed Samsung has grown as the latter faces increased Chinese competition and the end of clients’ product life cycles Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) retained the No. 1 title in the global pure-play wafer foundry business in the third quarter of this year, seeing its market share growing to 64.9 percent to leave South Korea’s Samsung Electronics Co, the No. 2 supplier, further behind, Taipei-based TrendForce Corp (集邦科技) said in a report. TSMC posted US$23.53 billion in sales in the July-September period, up 13.0 percent from a quarter earlier, which boosted its market share to 64.9 percent, up from 62.3 percent in the second quarter, the report issued on Monday last week showed. TSMC benefited from the debut of flagship
A former ASML Holding NV employee is facing a lawsuit in the Netherlands over suspected theft of trade secrets, Dutch public broadcaster NOS said, in the latest breach of the maker of advanced chip-manufacturing equipment. The 43-year-old Russian engineer, who is suspected of stealing documents such as microchip manuals from ASML, is expected to appear at a court in Rotterdam today, NOS reported on Friday. He is accused of multiple violations of the sanctions legislation and has been given a 20-year entry ban by the Dutch government, the report said. The Dutch company makes machines needed to produce high-end chips that power
As South Korea descends into political chaos, its equity market risks falling further behind major tech rival Taiwan, which is basking in the glory of a global artificial intelligence (AI) boom. A near-30 percent surge in Taiwan’s stock benchmark this year, set to be the best since 2009, has already helped spur a historic divergence between Asia’s two tech-dominated markets. The nation’s market capitalization now exceeds South Korea’s by about US$950 billion as the world’s AI frontrunners from Nvidia Corp and Microsoft Corp to OpenAI all increasingly turn to Taiwanese firms for supply. Looking ahead to next year, while both export-oriented economies
RSS