AMSTERDAM, Feb 11 (Reuters) - A Dutch court on Wednesday ordered an investigation into mismanagement at chipmaker Nexperia BV and upheld an October decision to suspend former CEO Zhang Xuezheng, the
Dutch Court Launches Investigation into Nexperia, Impacting Chinese Parent
Nexperia's Corporate Standoff
By Toby Sterling and Bart H. Meijer
Background of the Dispute
AMSTERDAM, Feb 11 (Reuters) - A Dutch court ordered an investigation into mismanagement at chipmaker Nexperia, dealing a blow to Chinese parent Wingtech by allowing the European management team that took charge after a Dutch state intervention last year to stay in place.
Court's Decision and Implications
The fight over Nexperia, which has spread from boardrooms to Brussels and Beijing, is one of the most prominent recent corporate standoffs between Europe and China and has disrupted global supplies of basic chips to the car industry.
Future Prospects for Nexperia
A breakdown between Nexperia's European wafer production arm and its China-based parent and Chinese packaging subsidiary remains unresolved.
"The situation at Nexperia primarily calls for stability so that Nexperia can restore its internal relationships, its production chain, and its delivery to customers," judges at the Amsterdam Enterprise Chamber said in a written decision.
NEXPERIA, CHINESE PARENT SEEK WAY OUT OF STANDOFF
During the probe - expected to take months - emergency measures imposed in October that include the suspension of former CEO and Wingtech founder Zhang Xuezheng and the temporary transfer of shareholder voting rights to a Dutch court-appointed administrator, will remain in place, the court said.
Wingtech now has little chance of regaining control of Nexperia before it follows through on plans to expand packaging facilities in Malaysia, ensuring a non-Chinese chip supply for its customers.
Wingtech said in a statement it regretted the court decision, but will "continue to pursue the restoration of its full shareholder rights through all available legal means." It noted that the investigation will also examine the actions of European managers, something its lawyers had requested.
The Chinese packaging arm, operating independently as Nexperia China, is seeking to replace European-made wafers with domestic Chinese alternatives.
The two sides could still negotiate a less costly resolution.
"We hope to engage in constructive and meaningful dialogue with management in China as soon as possible," a Nexperia spokesperson said.
(Reporting by Toby Sterling; Editing by Louise Heavens and Elaine Hardcastle)
