Foreign Affairs Committee Chair Sounds Alarm Over ‘Stealth’ Chinese Purchase of Cambridge Chip Startup

Foreign Affairs Committee Chair Alicia Kearns on Wednesday wrote to Business Secretary Grant Shapps, calling for a review into the Chinese takeover of a UK semiconductor company.
Flusso CEO and co-founder Andrea De Luca said Shanghai Sierchi Enterprise Management Partnership, the acquiring vehicle, did notify the UK government about their purchasing intention.
The company was set up in 2016 as a spin-out from the University of Cambridge. It boasts of being “fully embedded in the Cambridge tech cluster” and having access to the city’s “world-class technology expertise, skills, and support.”
In August 2022, Flusso announced its £28 million ($31 million) takeover by “a company and a global private equity (PE) fund,” but didn’t name the acquirer.
According to Companies House documents, Shanghai Sierchi Enterprise Management Partnership bought 100 percent of Flusso’s shares on Aug. 11, 2022.
On the same day, Shi Feiran and Zhou Dan, both based in Shanghai, were appointed as directors of the company.
The Epoch Times has not been able to independently verify the information, but Flusso is listed on the website of Baoding Investment as one of its investment projects.
It’s unclear who owns the other 20 percent of Sierchi.
De Luca also told the publication that the unnamed company “chooses to not publicise its name” because it’s going through an initial public offering and doesn’t want to affect the IPO.
Under the UK’s National Security and Investment Act, businesses and investors may be legally required to notify the government about certain sensitive acquisitions.
Citing the UK government’s recent intervention in the Chinese acquisition of Welsh microchip company Newport Wafer Fab and vision-sensing technology from the University of Manchester under its new national security law, the Foreign Affairs Committee chair argued the takeover of Flusso “most certainly meets the threshold for a review.”
Kearns warned of the CCP’s ambition to become a tech superpower and establish geopolitical leverage, saying the Chinese takeover of leading company in designing and selling flow sensors “represents a significant economic and national security concern.”
The relationship between the UK and the Chinese regime has become increasingly strained following Beijing’s upending of democracy and the rule of law in Hong Kong, its reciprocal sanctioning of British politicians who are vocal critics of its human rights abuses in Xinjiang, and the beating of a Hong Kong protester by Chinese diplomats in Manchester.
Prime Minister Rishi Sunak said in a major foreign policy speech on Nov. 28 last year that the so-called “golden era” of the Sino–British relationship is over, and that the UK will strengthen its resilience and economic security.
Since the National Security and Investment Act come into effect last year, successive business secretaries have made 14 interventions in foreign investments over national security concerns, eight of which targeted Chinese buyers.
Following the acquisition of Newport Wafer Fab by Chinese-owned Dutch company Nexperia, Shapps on Nov. 16 ordered the newly-named Nexperia Newport Limited to sell most of its shares, ruling the takeover had breached national security laws.