Yageo to acquire 20% stake in PMIC firm uPI

Monica Chen, Hsinchu; Jessie Shen, DIGITIMES Asia 0

Passive component maker Yageo has disclosed plans to take part in uPI Semiconductor's impending private placement. uPI Semiconductor is an affiliate of Asustek Computer specializing in Power Management ICs (PMIC) and power discretes, such as MOSFETs. Assuming the purchase goes through, Yageo will become the largest shareholder of uPI.

Yageo announced it will fully participate in uPI's private placement for 21 million shares, following a mutual resolution passed at a board of directors meeting on May 24. After the transaction, Yageo will become uPI's largest single strategic shareholder with a 20.23% stake.

According to Yageo, this strategic investment in uPI will extend the share of both parties in the future high-growth market of electronic components by facilitating the mutual integration of global sales channels and joint development.

"We believe uPI's strong design capabilities across many different important semiconductor products, especially in its multi-phase VCore (core voltage) controller ICs and its highly integrated power stages, will best complement our existing portfolio," said Yageo founder and chairman Pierre Chen. "Given the nature of having to work closely with CPU, GPU, and memory for VCore controller ICs and power stages, this strategic investment into uPI will further strengthen our relationships with world-leading IC design companies to be even earlier in the customers' design cycle."

"In addition, we will be able to provide more value-added products and services to our customers by enhancing our one-stop-shop model with differentiated products such as power modules and others," Chen continued. "This strategic move is another testament to YAGEO's unique position in the global electronic supply chain with premium channels and strong customer relationships in all the most highly anticipated markets such as AI, high-performance computing, industrial and automotive."

Other shareholders of uPI include UMC's investment arm Triknight Capital, and TXC.

"The key rationale behind the private placement is to accelerate and to open up more opportunities through leveraging YAGEO's strengths in its brand and channels in high-end applications like high-performance computing, automotive, industrial, and medical, as well as premium markets like North America, Europe, Japan, and Korea," said uPI's chairman S. Y. Hsu. "The additional capital obtained from the private placement will also provide uPI with more flexibility to look for more immediate opportunities to expand its business and operations to maintain and improve its competitive advantage."

In 2023, uPI's net profits decreased by 95.6% year-on-year to NT$50.5 million (US$1.57 million). The company attributed the substantial profit decline to inventory adjustments and the loss that resulted from the decreasing value of its inventory.

Non-operating income boosted uPI's profitability in the first quarter of 2024, resulting in net earnings of NT$115 million, which exceeded those for the entire year of 2023.