May 23, 2025

Cross-border deals, shifting rules, and fresh silicon

Round-up

Highlights

  1. Foxconn circles Singapore’s UTAC in a possible US $3 billion buy-out. The contract-electronics giant is one of several suitors eyeing the OSAT player, signalling that packaging capacity is becoming strategically as valuable as wafer fabs1.
  2. Nvidia quietly turns rivals into customers. Jensen Huang’s Computex send-off unveiled NVLink Fusion, a fabric that lets other companies’ custom accelerators snap into Nvidia’s ecosystem—an attempt to keep its AI crown even if hyperscalers curb capex2.
  3. Foreign governments warn Washington: chip tariffs could backfire on US security. A new wave of Section 232 comments argues that taxing imported semiconductors would deter investment in American fabs—an ironic twist after yesterday’s newsletter covered the first backlash to the probe3.

Other developments

  • China asks the Netherlands to reopen the door on advanced lithography exports during a ministerial visit to Beijing4
  • A Taiwan-hosted Global Semiconductor Forum calls for “like-minded” supply-chain alliances to blunt future shocks5
  • US universities and industry leaders sound alarms over a looming 300 000-engineer shortfall as new fabs come online6
  • Investors position ahead of Nvidia’s earnings next week as rising US bond yields rattle tech multiples7
  • Amundi’s MSCI Semiconductors ETF posts a fresh NAV of US $189.34, up 1.2 % day-on-day despite market jitters8
  • Activist Water Street Capital presses Norway’s REC Silicon to reject Hanwha’s buy-out offer, calling the polysilicon maker “dramatically undervalued”9

Did you know? If Foxconn pays the rumoured US $3 billion for UTAC, the implied multiple is about 10× the target’s estimated US $300 million EBITDA—rich for legacy packaging, but still half what advanced-node foundries fetched in 20241.

In-depth

1 · Government & Corporate Policy

  • Tariffs vs. security paradox

    • Foreign submissions to Commerce’s Section 232 probe argue that blanket chip duties would raise costs for US fabs that still depend on imported tools and substrates3.
    • Commenters warn the move could slow CHIPS-Act projects and push allies toward China-centric supply chains3.

  • China–Netherlands export-control thaw

    • Beijing urged The Hague to “maintain close communication” on semiconductor licences after months of tension over ASML sales4.
    • Dutch FM Caspar Veldkamp hinted at a later prime-ministerial visit, signalling room for compromise even under US pressure4.

  • Democracies double-down on resilience

    • At ITRI’s forum in Taipei, officials from Taiwan, the EU, Japan and the US endorsed joint R&D funding and “trusted-supplier” tax credits to accelerate advanced packaging lines in 2026-20285.
    • Speakers highlighted open-source EDA and common workforce standards as early areas for cooperation5.

  • Workforce gap moves to centre stage

    • A new analysis pegs the US engineering shortfall at 300 000 by 2030 unless semiconductor curricula expand rapidly6.
    • Missouri S&T announced a dedicated bachelor’s in semiconductor engineering; other state schools are preparing similar tracks6.

2 · Economics, Finance & Business Outlook

  • Foxconn’s UTAC play

    • Wise Road Capital has hired Jefferies to shop UTAC; non-US bidders are expected because of the target’s China footprint1.
    • Foxconn would gain test and advanced-package expertise for its EV and server ambitions, complementing its Ohio fab project1.

  • Nvidia earnings on deck

    • Wall Street eyes whether H100 order slippage and China export curbs will dent guidance after a 1 % YTD share dip7.
    • Strategists say a miss could chill the broader AI-hardware rally that lifted SOX 18 % in Q17.

  • Materials M&A heat

    • Water Street’s open letter claims REC Silicon’s polysilicon assets justify a valuation “far north” of Hanwha’s indicative price9.
    • The spat underscores growing demand for US-based polysilicon as module makers decouple from Xinjiang supply chains9.

  • ETF flows steady

    • Amundi’s semiconductor tracker recorded modest inflows despite the tariff overhang, suggesting rotational rather than wholesale flight from the sector8.

3 · Technology & R&D

  • NVLink Fusion broadens Nvidia’s moat

    • The interconnect lets third-party ASICs ride Nvidia’s software stack, turning would-be competitors into partners and anchoring demand for Blackwell GPUs2.
    • Early adopters include Marvell and several sovereign AI projects looking to blend custom inference chips with CUDA-native GPUs2.

  • Intel Xenon 6 aims at GPU-heavy servers

    • Three new P-core variants tout up to 128 cores, 192 PCIe lanes and MRDIMM support, debuting first in Nvidia’s DGX-B300 systems10.
    • Intel claims 30 % faster memory and configurable turbo bins that prioritise CPU cores feeding hungry GPUs10.

  • eSIM moves inside the modem

    • GCT Semiconductor and Giesecke + Devrient launched the first SGP.32 eSIM with IPAd baked into a 5G modem, simplifying fleet management for headless IoT nodes11.
    • The design supports on-device profile activation across multiple networks without a removable SIM tray11.

  • Optical frequency combs hit microwave precision

    • Researchers demonstrated dispersive-wave-agile optical frequency division that shrinks ultra-stable microwave sources onto a photonic chip, a potential boon for 6G and radar SOCs12.
    • The technique locks comb endpoints to a reference cavity, transferring frequency stability to the repetition rate detectable as a low-phase-noise microwave signal12.

Footnotes

  1. https://www.reuters.com/world/asia-pacific/foxconn-among-potential-bidders-singaporean-chip-assembly-firm-utac-3-billion-2025-05-23/ ↩︎ ↩︎ ↩︎ ↩︎

  2. https://www.reuters.com/world/asia-pacific/amid-jensanity-nvidia-signals-plans-keep-ai-crown-2025-05-23/ ↩︎ ↩︎ ↩︎

  3. https://insidetrade.com/daily-news/foreign-governments-companies-chip-tariffs-endanger-us-national-security ↩︎ ↩︎ ↩︎

  4. https://www.reuters.com/en/china-netherlands-pledge-deeper-cooperation-tackle-global-challenges-2025-05-22/ ↩︎ ↩︎ ↩︎

  5. https://www.globenewswire.com/news-release/2025/05/23/3087375/0/en/Global-Semiconductor-Forum-Highlights-Democratic-Cooperation-to-Strengthen-Supply-Chain-Resilience.html ↩︎ ↩︎ ↩︎

  6. https://roboticsandautomationnews.com/2025/05/23/semiconductor-manufacturing-faces-labor-crisis-can-the-us-train-enough-workers-in-time/91142/ ↩︎ ↩︎ ↩︎

  7. https://www.reuters.com/business/wall-st-week-ahead-nvidia-earnings-focus-rising-us-yields-debt-rattle-markets-2025-05-23/ ↩︎ ↩︎ ↩︎

  8. https://markets.ft.com/data/announce/detail?dockey=600-202505230320DGAP____UKPR_____UK_Regulatory_2144446-1 ↩︎ ↩︎

  9. https://markets.ft.com/data/announce/detail?dockey=600-202505230600PR_NEWS_USPRX____CN95098-1 ↩︎ ↩︎ ↩︎

  10. https://www.tomshardware.com/pc-components/cpus/intel-launches-three-new-xeon-6-p-core-cpus-will-debut-in-nvidia-dgx-b300-ai-systems ↩︎ ↩︎

  11. https://www.businesswire.com/news/home/20250522173360/en/GCT-Semiconductor-and-GieseckeDevrient-Partner-to-Launch-Innovative-eSIM-Solution-for-IoT-Devices ↩︎ ↩︎

  12. https://www.nature.com/articles/s41566-025-01667-4 ↩︎ ↩︎