KUALA LUMPUR: JF Technology Bhd
(JF Tech) is making a foray into the United States semiconductor market through its indirect subsidiary, ATS Technology Services Sdn Bhd (ATSSB), which has agreed to acquire a 13% stake in ATS Technology Services Inc. (ATSI) for US$1.3mil (about RM5.46mil).
The deal, formalised through a shareholders agreement signed on Sept 23, will see ATSSB subscribe to 130,000 new ordinary shares in ATSI. The investment is intended to set up a semiconductor automatic test equipment (ATE) test cell business in the US.
ATSI, incorporated in California, is led by director and shareholder Paul Anthony Emmett, who together with Susan Emmett will retain an 87% stake following the transaction.
According to JF Tech, ATSSB will function as “a procurement and value-added logistics company, responsible for sourcing and purchasing semiconductor test parts and components from approved suppliers,” while ATSI will focus on engaging with US customers to promote adoption, provide support and address technical inquiries.
Under the terms of the agreement, ATSSB will be protected against dilution, with ATSI barred from issuing new shares or convertible securities without its consent. ATSSB will also be entitled to appoint one board director for as long as it holds at least 13% of the company.
The RM5.46mil consideration will be funded internally via inter-company borrowings from JF International Sdn Bhd, a wholly-owned unit of JF Tech. The company said no contingent liabilities or guarantees will be assumed.
Explaining the rationale in a bourse filing yesterday, JF Tech said the investment would strengthen its position in the semiconductor value chain.
“The Proposed Investment brings strong synergies to JF Tech, particularly for the test engineering solutions business,” it said. The company highlighted that the move complements its recent acquisition of Singapore-based Q3 Probe Pte Ltd, which specialises in wafer testing.
While the deal is expected to enhance long-term earnings, JF Tech cautioned that it carries inherent risks, including potential underperformance, integration challenges and exposure to market fluctuations.
“Effective risk management will be essential to realising the Proposed Investment’s intended value,” it noted.
At this stage, the investment is not expected to have a material impact on JF Tech’s issued share capital, net assets, or current earnings. However, it is projected to contribute positively to group earnings once operations in the US commence.
The transaction is not subject to shareholder or regulatory approval, and completion is expected by Sept 30, 2025.
