Key Points
- China’s National Integrated Circuit Industry Investment Fund (“Big Fund”) plans to sell up to 1.00% (4,159,815 shares) of its stake in Longsys 江波龙.
- The sale, happening between May 27 and August 26, 2024, is cited for the Fund’s “operational and management needs,” potentially for portfolio rebalancing or funding strategic initiatives like the new Big Fund III.
- Longsys expects no change in company control and no significant impact on its operations from this sale.
- This is a routine adjustment by a major state-backed fund within China’s ongoing strategy to boost its domestic semiconductor industry.
Here’s the latest on China’s key semiconductor investment vehicle: The National Integrated Circuit Industry Investment Fund is planning a slight reduction in its holdings of Longsys (Jiangbolong 江波龙) stock.
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What’s the Deal with the Longsys Share Sale?
Longsys, a player in the memory and storage solutions space, announced that one of its major shareholders is trimming its position.
The shareholder is the National Integrated Circuit Industry Investment Fund (Guojia Jicheng Dianlu Chanye Jijin 国家集成电路产业基金), often referred to simply as the “Big Fund”.
Here are the key details:
- Amount: The Big Fund plans to sell no more than 4,159,815 shares.
- Stake Percentage: This represents up to 1.00% of Longsys’ total share capital.
- Timing: The sale window is set between May 27, 2024, and August 26, 2024.
- Method: Shares will be sold through centralized competitive bidding transactions on the open market.
Why is the Big Fund Selling?
The official reason cited is straightforward: the Fund’s own operational and management needs.
This kind of move isn’t entirely uncommon for large investment funds, including state-backed ones like the Big Fund.
It can often reflect:
- Portfolio Rebalancing: Adjusting holdings across various investments.
- Profit Taking: Cashing in on previous gains after a lock-up period.
- Strategic Shifts: Potentially redirecting capital towards newer priorities or phases (like the recently announced Big Fund III).
The shares will be sold at prevailing market prices during the transaction period.
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Impact on Longsys (Jiangbolong 江波龙)?
According to the announcement, this planned share reduction is not expected to cause a change in Longsys’ control.
Furthermore, it’s stated that the sale won’t have a significant impact on the company’s:
- Governance structure
- Ongoing operations
The Big Fund has also committed to following all relevant laws and regulations, highlighting its adherence to previous share lock-up commitments.
For investors and observers, this appears to be a standard portfolio adjustment by a major shareholder rather than a signal of fundamental change within Longsys itself.
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Context: China’s National Semiconductor Strategy
The “Big Fund” is a crucial part of China’s national strategy to bolster its domestic semiconductor industry.
Established to reduce reliance on foreign technology, it invests strategically across the chip supply chain, from design to manufacturing and materials.
The Fund operates in phases, making significant investments:
- Big Fund I (Launched 2014): Focused on manufacturing.
- Big Fund II (Launched 2019): Broadened scope including equipment and materials.
- Big Fund III (Launched 2024): Reportedly capitalized with $47.5 billion (¥344 billion RMB), likely targeting cutting-edge chip manufacturing equipment and technologies.
Seeing the Big Fund trim stakes in some holdings while launching a massive new phase suggests ongoing strategic capital allocation within China’s vast semiconductor ambitions.
This move involving Longsys is a small adjustment in the grand scheme of the Big Fund’s multi-billion dollar portfolio, reflecting routine fund management within China’s semiconductor investment landscape.
FAQs
What is the “Big Fund”?
The “Big Fund” is the nickname for China’s National Integrated Circuit Industry Investment Fund (Guojia Jicheng Dianlu Chanye Jijin 国家集成电路产业基金). It’s a major state-backed investment fund created to support and develop China’s domestic semiconductor industry.
Why is the Big Fund selling Longsys shares?
The stated reason is for the Fund’s own “operational and management needs.” This could involve portfolio rebalancing, taking profits, or freeing up capital for other strategic investments, especially considering the recent launch of Big Fund III.
How much Longsys stock is the Big Fund selling?
The Fund plans to sell a maximum of 4,159,815 shares, which equates to no more than 1.00% of Longsys’ total share capital.
Will this sale affect Longsys’ business?
According to the official announcement, the sale is not expected to change who controls Longsys or significantly impact its governance structure or day-to-day operations.
References:
- Original Source: Yicai (第一财经)
- Reuters: China’s ‘Big Fund’ trims stakes in semiconductor firms (August 2023 Background)
- TechNode: China launches third phase of national semiconductor fund with $47.5 billion
- Longsys Electronics: Longsys Electronics Official News
Disclaimer: This content is purely for informational purposes. It doesn’t constitute investment advice. Always do your own research and consult with professionals before making investment decisions. Investing involves risk.
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