Apple supplier AMS agrees joint venture for environmental sensor business
* Private equity fund Wise Road Capital to hold majority
* AMS' move follows plan to focus on other sensors
* JV aims to boost sales on Chinese market
* AMS shares gain as much as 2.3 percent
(Adds detail, background, shares)
By Kirsti Knolle
VIENNA, March 19 (Reuters) - Austrian chipmaker AMS AG
has agreed a joint venture for its
environmental sensor business with private equity fund Wise Road
Capital, effectively offloading the unit as part of its plan to
focus on other business segments.
AMS has suffered from slow demand for Apple's
latest iPhones, which it supplies with face recognition
technology sensors, resulting in a nearly 60 percent drop in
fourth-quarter core profit.
Wise Road Capital will hold a "small majority" in the new
entity, according to an AMS spokesman, while AMS shifts its
focus to optical, image and audio sensors.
The private equity fund buys into European and North
American high-tech companies and helps them grow in China,
according to its website.
It was part of the consortium that bought NXP
Semiconductors' Nexperia business in 2016 before
selling it in the largest buyout-backed exit outside of the U.S.
market in 2018.
"Wise Road Capital sees immense potential in marketing the
excellent technology and products developed by AMS," said
Michael Zhang, Managing Partner at Wise Road Capital.
Environmental sensors detect temperature or moisture and can
be used in autos, buildings and air quality monitoring
AMS's units for ultrasound-based flow sensors -- used in
smart metering solutions for utilities -- and pressure sensors
for identifying fluid and gas flows will also be transferred to
the joint venture, it said.
Investments in the new entity, which is valued at
approximately $120 million, will be made according to the
shareholding, the AMS spokesman said.
"This new JV will...(focus) on further advancing and
developing AMS' award-winning environmental, flow and pressure
sensor solutions, for which we see the largest market
opportunity in China," said Chris Feige, Executive Vice
President at AMS AG.
Stefan Raible, currently general manager of AMS's
environmental sensors business, will head the JV. The staff will
continue to work in Eindhoven, Netherlands, where the JV will
also be headquartered, according to the spokesman.
Asked how many employees were affected, he said "more like
100 than 1,000".
Shares in Swiss-listed AMS gained as much as 2.3 percent to
29.26 Swiss francs, while the European tech index was
flat. AMS shares traded at around 115 Swiss francs a year ago.
(Reporting by Kirsti Knolle, Editing by Louise Heavens and
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