Shanghai-listed vegetable and walnut beverages maker Hebei Yangyuan ZhiHui Beverage said that it would invest 1.6 billion yuan ($219.5 million) for a 0.99% stake in top memory chipmaker Yangtze Memory Technologies Corp (YMTC).
Despite gaining approval from Yangyuan’s board of directors in December 2023, the deal was only disclosed in an exchange filing on April 26. The beverage firm cited “trade secret” as the reason behind the delay of its information disclosure.
The disclosure offered a glimpse into the country’s top memory chipmaker’s financials. The Wuhan-registered firm sank into the red in the first nine months of 2024 when it booked an unaudited net loss of around 84.2 million yuan ($11.6 million), after a profitable 2023 when it recorded a net profit of 531.1 million yuan ($72.9 million).
As China’s first domestic mass-producer of 3D NAND flash memory chips, these advanced flash memory chips involve the technology of stacking flash memory cells vertically within a transistor die to significantly increase storage density.
Post financing, Yangyuan would be the eighth-largest shareholder in the cap table, per the filing.
Besides Yangyuan, 22 other investors were also part of the capital infusion that saw YMTC’s registered capital up by 6% from 105.3 billion yuan ($14.4 billion) to around 111.8 billion yuan ($15.3 billion).
YMTC has been one of the chipmaking firms subject to US trade sanctions since 2022, which has pushed firms to turn to domestic chip tool makers.
Yangyuan said in the filing that YMTC could be subject to further restrictions on equipment and materials supply from foreign suppliers if trade tension continues to escalate, especially as YMTC’s sales area covers mainland China, Hong Kong, and certain countries in Asia, Europe, and North America.
Investors continue to pour massive funds into semiconductor startups vis-à-vis their counterparts in other industries amid the government’s attempt to strive for self-sufficiency in chips.
Semiconductor startups sustained their strong fundraising momentum as a record 120 deals were sealed in the sector in Q1 2025, the highest since Q3 2023, according to DealStreetAsia’s proprietary data. The deal count was 25% higher QoQ and up 11.1% YoY. However, the proceeds of $1.1 billion were at a four-year low.
