Sudden! Wen Ye buys Fuchang! $3.8 billion! A sudden change in the distribution of components

Wen Ye management held a press conference

Today (September 14) , Wen Ye microelectronics announced that it has signed a final agreement to acquire Future Electronics Inc. . (“Fuchang Electronics”)100% stake, all-cash trading enterprise value of 38 billion U. S. dollars (about 27.7 billion yuan) . 

Wen will be among the top three semiconductor distributors in the world.

This is a revolution for Wen Ye and Fuchang Electronics and is also important for the electronic component ecosystem,” said Zheng Jiaqiang, chairman and chief executive of Wen Ye. “Fuchang Electronics has an experienced, strong management team and a talented workforce that is highly complementary to Wenye in terms of product supply, customer coverage and global distribution. Future's management team, all employees worldwide, and all locations and distribution centers will continue to operate and add value to the organization. We are pleased to invite Mr Baig to join the WENYE Microelectronics Board upon completion of the transaction and look forward to working with him and his talented colleagues around the world to build a first-class electronic component distributor.”

“We are pleased to join Wen ye microelectronics and believe this transaction will benefit all our stakeholders. Our two companies share a culture that is driven by a rich entrepreneurial spirit that will empower our talented global workforce.” Said Omar Baig, President, CEO and Chairman of Fuchang Electronics. “This merger is an excellent opportunity for Wen ye microelectronics and Fuchang Electronics to jointly build world-class industry leaders and enable us to continue to implement our long-term strategic plan to provide the highest level of service to our customers, which we have been doing for the past 55 years.”

As for the source of funds, Wen Ye believes that the proposed use of his own funds and the bank financing loan provided by DBS Bank as the source of financing for this transaction has been unanimously approved by the Wen Ye Technology Board and the Future board of directors, delivery is expected to be completed in the first half of the 2024 year, subject to the required institutional approval.

The industry pointed out that Future Electronics had been bought and sold for a long time, and IC in China had been in contact with it. However, the situation was finally broken due to financial and price factors, in the second half of last year, when the semiconductor boom began to freeze and terminal inventories rose sharply, many manufacturers had to help stock up under the requirements of their original manufacturers. In addition, US interest rates were raised, interest expenses increased and financial pressure doubled, could be an important factor in speeding up the merger.

Founded in 1968 and headquartered in Montreal, Canada, Fuchang Electronics has 169 offices in 44 countries/regions in the s, Europe, Asia, Africa and Oceania, the company, which owns Taiwan Pioneer Electronics, was ranked by research firm Gartner in 2019 for Global Semiconductor Channel sales, the world's first for the United States, the second largest United Nations, the United States, Anfuli, Wen Ye ranked fourth, Fuchang Electronics ranked seventh.

This is another important milestone in Wen's global expansion following his acquisition of singapore-based company WT Semiconductor PTE, through a 100% stake in the company's subsidiary, WT Semiconductor PTE, last April. Ltd. . To acquire a 100% stake in SSH technology for S $1.93 per share in cash and a total amount of s $232.2 million, and complete the relevant procedures by the end of the year, wen was able to strengthen his product line and expand his business rapidly.

After the acquisition of Fuchang Electronics, Wen Ye's global ranking will push him into the top three, shaking up other competitors. However, one of his competitors, General Union University, is also one of Wen Ye's top three shareholders, the company still owns 177,000 shares with a 19.97 per cent stake, followed by Xiangshuo with 171,000 shares and a 19.28 per cent stake.

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