Inari signs MoU with a private equity fund in China to expand OSAT business

KUALA LUMPUR: Inari Amertron Bhd has entered into a preliminary deal with a private equity fund China Fortune-Tech Capital Co Ltd (CFTC) to set up a joint venture in China.

The JV company was intended to carry out Outsourced Semiconductor Assembly and Test (OSAT) manufacturing and related businesses.

Inari will own a 55% stake in the JV company with CFTC holdings the remaining 45% equity interest.

The proposed JV will also help Amertron Technology (Kunshan) Co Ltd (ATK) to expand its business in China.

"Inari will contribute 100% of the equity shares of ATK and new cash investment of RMB463mil as its capital contribution" into the JV company, the company said in a filing today.

Meanwhile its partner CFTC will contribute new cash investment of RMB749mil and RMB21mil as 100% of its equity shares of Yiwu Semiconductor International Corp (YSIC) with a combined value of RMB770mil.

"The MOU will bring together the strengths of both Parties and leveraging each other’s expertise through knowledge transfer from Inari to the JV company while Inari will draw from CFTC’s local leadership and guidance in the operation," Inari said.

The MoU, Inari added, also represented an opportunity and commitment to foster a business relationship with CFTC with a view to collaborate and expand the OSAT business of Inari and ATK.