British government buys key chip plant, preserving skilled jobs
The Newton Aycliffe semiconductor plant will be renamed Octric Semiconductors UK and receive government investment to help revitalise the business.
The British government has purchased a struggling semiconductor factory from United States-based Coherent Inc. to safeguard domestic production of gallium arsenide semiconductors. These components are vital for military technology, including fighter jets. The plant, located in Newton Aycliffe, northern England, is the United Kingdom‘s only secure producer of these semiconductors.
The acquisition, estimated at £20 million ($27 million), ensures the preservation of 100 skilled jobs. While it is unusual for the government to intervene in private companies, the semiconductor industry has become a strategic priority due to its crucial role in both the economy and national security.
Semiconductors are key to the UK’s future technological advancements, particularly in growth and clean energy sectors. The British government has previously intervened in the industry, having bought Newport Wafer Fab three years ago to prevent a sale to a Chinese-owned firm.
The Newton Aycliffe factory, which had faced financial challenges after losing contracts, will receive government investment under its new name, Octric Semiconductors UK, as part of efforts to revitalise the business.