CG Power Announces Partnership To Set Up Semiconductor Facility In India

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  • According to the filing, CG Power, Renesas, and Stars plan to invest up to $205 million, $15 million, and $2 million
  • The joint venture agreement will be effective after the proposed project transaction is approved

CG Power and Industrial has partnered with Renesas America Inc and Stars Microelectronics (Thailand) Public Co in a joint venture agreement and proposed to set up an outsourced semiconductor assembly and testing facility in India.

The company stated in a stock exchange filing that the venture is contingent upon obtaining necessary regulatory and statutory approvals, including those from the Indian government’s Ministry of Electronics and Information Technology and subsidies from central and state governments, where applicable.

According to the filing, CG Power, Renesas, and Stars plan to invest up to $205 million, $15 million, and $2 million in one or more instalments as equity capital of the joint venture (JV) company. These investments will represent approximately 92.34%, 6.76%, and 0.9% of the JV.

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Furthermore, the filing disclosed that CG Power has entered into a technology and services agreement, an offtake and manufacturing agreement with Renesas Electronics Corporation in Japan, and a technology know-how sharing and technical support agreement with Stars.

The joint venture agreement will be effective after the proposed project transaction is approved. “The closing of the proposed project transaction is also subject to satisfactory completion of the conditions precedents as contained in the joint venture agreement,” it added.

CG Power and Industrial Solutions shares ended 1.53% lower at ₹430.5 apiece on Thursday, February 8, 2024. The stock has gained 38.22% in the past year.

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