The Dutch government has approved the acquisition of Dutch chip startup Nowi by Chinese-owned Nexperia. Nowi specializes in power management chips that can use ambient sources of electricity such as light or vibrations as a power source. The acquisition was made last year for an undisclosed sum. However, the Dutch government decided to retroactively review the deal in May this year.
The decision to review came after the government established a new office to assess foreign takeovers involving potentially sensitive technologies. The Dutch government has now deemed Nowi’s technology not a threat to national security because it’s not dual-use. The acquisition is significant as it comes amid greater scrutiny of Chinese tech investments and the West’s increasing clampdown on transfers of critical technology to China.
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Background
Nowi is a Dutch semiconductor startup that makes power management chips that can use ambient sources of electricity such as light or vibrations as a power source. The company’s technology is potentially useful as a way to remove the need for batteries in simple electronic devices. Despite consuming minimal power, the batteries in Nowi’s devices typically need replacement every few years. However, through energy harvesting—extracting energy from the immediate environment—Nowi’s technology can eliminate the need for battery replacement. The startup currently holds eight patents and operates on the belief that technology benefits society, with commercialization being the fastest and most effective way to achieve this.
Nexperia, on the other hand, is a Chinese-owned computer chip maker that specializes in power management, protection, and signal conditioning components. The company was acquired by China’s Wingtech Technology in 2019 for $3.9 billion.
Dutch Government’s Approval
The Dutch government does not consider the deal as a threat of any kind. Dutch Economic Affairs Minister, Micky Adriaansens said in a letter to parliament on Monday, confirming an earlier Bloomberg News report. The move signals that the Netherlands is still open to business with China.
Nexperia said on Monday it welcomed the Dutch government’s decision to green-light the deal. “While we’ve always said that Nowi’s and Nexperia’s technology is harmless, today’s announcement confirms this,” Nexperia Netherlands director Charles Smit said in a press release. “It is important that there is a clear policy that strengthens the Dutch investment climate. In these uncertain times, a transparent, fact-based dialogue between government and business is of paramount importance.”