Polymatech will spend $200-300 million on acquisitions in FY25; The IPO process will restart in FY26

Eswara Rao Nandam, founder of Polymatech Electronics, said: Mint The acquisitions will be financed through a mix of internal accruals and external investments from potential equity investors, it said.

“We have an expansion of our US semiconductor manufacturing facility planned for next year and an acquisition in Grenoble, France, which will crystallize in the next three to four weeks. “Approximately 200-300 million dollars will be needed for both facilities,” he said.

In August, Polymatech’s wholly-owned subsidiary in Singapore, Artificial Electronics Intelligent Materials Pte Ltd, acquired California-based Nisene Technology Group, one of the oldest manufacturers of integrated circuits built on silicon and silicon carbide wafers. Polymatech currently produces sapphire-based semiconductors. Nandam announced that equity investment is expected to come to Nisene for the expansion of this facility, which will produce silicon carbide and sapphire wafers, high-performance Central Processing Units (CPUs) and Graphics Processing Unit (GPUs) for computers and mobile phones.

“Some US funds have approached us to invest in Nisene and the minimum ticket size will be around $50-100 million,” Nandam added. The company is looking at technology acquisitions in the UK.

Increasing wafer technology capabilities

The acquisitions will enable multi-wafer technology capabilities, giving the company an edge over global competitors. Polymatech, which produces different types of opto-semiconductor chips, also called photonics, on wafers such as silicon, silicon carbide and gallium nitride, competes with OSRAM GmbH, Broadcom Inc, Samsung, Lite-On Technology, Lumileds Holdings, Toshiba Electronic Devices and Storage Corporation, among others. among global players.

The Chennai-based company designs, manufactures, packages and assembles semiconductor chips and chip modules for various applications, including medical, agriculture, large area lighting, personal computers, laptops and mobile phone backlights. It also exports to the USA, UK and the Middle East.

The company continues to make a new plan ₹1,500 crore IPO is likely to be undertaken only after the acquisitions are completed. Promoters including Nandam hold about 80% of Polymatech, with 2.6% held by Nav Capital Emerging Star Fund. Mint Earlier this year, it reported that the company plans to raise twice the amount it had previously planned and will re-apply to the Securities and Exchange Board of India (Sebi) later this year.

As Polymatech has expanded its operations from two manufacturing units in Chennai to Singapore, Bahrain, the US and Europe through different companies, it has embarked on restructuring to bring the companies under a single holding company, Nandam said.

“We have authorized KPMG for the structuring and they will represent us before the commercial bankers. No matter where our factories are located, all this financial information needs to be brought to Polymatech India and consolidated. “It will take six to seven months,” he said.

Polymatech’s revenue nearly doubled ₹Approximately 1,200 crore in FY24 ₹650 crore in FY23. In FY22, its income was as follows: ₹125.87 crore. The company expects to double its revenues every year due to the expected increase in chip demand in the coming years. It also increased its chips packaging capacity by 1 billion units in FY24.

Key Takeaways

1. The acquisitions will be financed through a mix of internal accruals and external investments from potential equity investors.
2. Polymatech makes sapphire-based semiconductors. Equity investment is expected to come to Polymatech’s US arm Nisene to expand its US facility, which will produce silicon carbide and sapphire wafers, high-performance CPUs and GPUs for computers and mobile phones.
3. Polymatech is also looking at technology acquisitions in the UK.
4. The company, OSRAM GmbH, Broadcom Inc., Samsung, Lite-On Technology, Lumileds Holdings, Toshiba Electronic Devices and Storage Corp. competes with.
5. The chipmaker continues to make a plan ₹1,500 crore IPO but this amount is likely to increase once the acquisitions are completed.