China’s largest auto chip maker’s IPO efforts are suspended by government suppression
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Chinese electric vehicle (EV) manufacturer BYD has a semiconductor unit called BYD Semiconductor, which plans to list on the Shenzhen Stock Exchange. BYD Semiconductor was originally prepared for an initial public offering (IPO), hoping to start public trading as soon as possible, but stopped the IPO due to government suppression of its business.
According to the latest report BBC News, Chinese company BYD Semiconductor is seeking to be listed on the Shenzhen Stock Exchange. However, due to some problems with the law firm preparing BYD Semiconductor to enter the public trading venue, a regulatory investigation is underway.
Beijing Tianyuan Law Firm is one of the largest legal services companies in China and has recently been investigated by the government for its practices by the China Safety Supervision and Administration Commission. Except for the facts of the investigation, there is no detailed information on why the investigation should be conducted, thus preventing BYD Semiconductor from entering the public trading arena.
BYD Semiconductor is China’s largest supplier of microcontrollers and various other chips in the electric vehicle market. Due to the current shortage of chips in the entire industry, semiconductor companies have received a lot of attention from customers and even regulatory agencies to supervise their operations.
As the Chinese authorities pass more regulations to tighten the industry, whether BYD Semiconductor will be listed as soon as possible is a question. Legal disputes may take several months to end, and the Chinese government may require legal services companies to provide additional paperwork so that BYD Semiconductor can try to apply for a public transaction. If the company enters the public sector, it can raise additional funds to further develop its chip manufacturing business, thereby alleviating the current shortage of semiconductors.
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