Buffett-backed EV maker BYD gets approval from Hong Kong bourse for semiconductor unit spinoff in Shenzhen
- BYD is seeking to list the semiconductor business on Shenzhen Stock Exchange’s ChiNext board
- Spinoff will allow more equitable assessment of business units in the group, still needs approval from Shenzhen bourse, Chinese regulators
The company still needs to meet a number of conditions before it can be implemented, including receiving approval from the Shenzhen Stock Exchange and the China Securities Regulatory Commission (CSRC), according to the filing.
The spinoff “will enable investors to appraise the strategies, risks and returns of the businesses of BYD Semiconductor and the company separately and to invest directly in the relevant businesses independently,” BYD said. That would allow a more equitable assessment of the businesses, it added.
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The plan will help BYD Semiconductor, an independent leading manufacturer of automotive-grade IGBTs, or power electronic switching devices, to expand financing channel, to enhance brand awareness and to optimize corporate governance structure, BYD said in its interim report to shareholders in August.
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The group first announced in May a plan to list its 72.3 per cent-owned chip-making unit on ChiNext, a Nasdaq-like tech board operated by the Shenzhen bourse, with the aim of raising 2.69 billion yuan (US$421 million).
BYD revived its application to list the semiconductor unit last month after filing additional paperwork with Chinese regulators, according to Gasgoo.com, a Chinese automotive business-to-business marketplace and industry news website.