Wingtech sells 4.6 billion yuan of assembly assets to Luxshare after US sanctions losses
Wingtech Technology, a Chinese supplier to
Apple and other electronics makers, has agreed to spin off a major piece of its operations after
US sanctions threaten to bring heavy losses.
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The company signed an agreement to sell its stake in five subsidiaries to Luxshare Precision Industry, according to a filing with the Shanghai Stock Exchange on Thursday. Assets in three other Wingtech units will also be divested.
The sale of Wingtech's product assembly business, which involves assets worth about 4.6 billion yuan (US$635 million), would mean a full exit from this market. The shift would let the company focus only on semiconductor operations, a move it took after an 'in-depth assessment of the geopolitical environment and business development,' Wingtech said.
The technology firm, based in Jiaxing, Zhejiang, was added to the US Commerce Department's so-called entity list by then-President Joe Biden's administration in December. The companies on the list are seen as a threat to US national security or foreign policy interests and face restrictions.
Zhang Xuezheng, the chairman and chief executive of Wingtech. Photo: Handout
This has 'impacted the company's assembly business in terms of procurement, R&D and sales, leading to unfavourable situations such as difficulties in securing new project orders and the loss of existing project orders,' Wingtech said in its statement.
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