AXT, Inc. Crosses Major Milestone on Tongmei IPO
July 12 2022 - 9:15AM
AXT, Inc. (NasdaqGS: AXTI), a leading manufacturer of compound
semiconductor wafer substrates, today announced that its subsidiary
in China, Beijing Tongmei Xtal Technology Co., Ltd. (“Tongmei”),
was approved by the Shanghai Stock Exchange (“SSE”) for the listing
of Tongmei’s shares in an initial public offering (the “IPO”) on
the SSE’s Sci-Tech innovAtion boaRd (the “STAR Market”). The STAR
Market IPO remains subject to review and approval by the China
Securities Regulatory Commission (“CSRC”) and other authorities.
The SSE will now forward Tongmei’s application to the CSRC for its
review and approval.
Management Qualitative
Comments
“We consider this to be a major milestone in our
effort to complete the STAR Market IPO,” said Morris Young, chief
executive officer. “The SSE review process is detailed, thorough,
and lengthy. Its approval is an important step because we believe
that the CSRC relies heavily on the work performed by the SSE. I
want to congratulate our team for their hard work and diligence in
getting to this point in the process. Although the timing for the
IPO remains uncertain and depends upon many factors beyond our
control, the achievement of this milestone adds to our confidence
that Tongmei can complete the listing in this calendar year.”
STAR Market Listing is a Lengthy
Process
The process of going public on the STAR Market
includes several periods of review and, therefore, is lengthy. AXT
believes that the SSE review, which has just been completed, is
typically the longest part of the process. Subject to the review
and approval by the CSRC and other authorities, Tongmei expects to
complete the listing in the second half of 2022, probably in Q4
2022. AXT has posted a brief summary of the plan and the process on
its website at http://www.axt.com.
About AXT, Inc.
AXT is a material science company that develops
and manufactures high-performance compound and single element
semiconductor substrate wafers comprising indium phosphide (InP),
gallium arsenide (GaAs) and germanium (Ge). The company’s substrate
wafers are used when a typical silicon substrate wafer cannot meet
the performance requirements of a semiconductor or optoelectronic
device. End markets include 5G infrastructure, data center
connectivity (silicon photonics), passive optical networks, LED
lighting, lasers, sensors, power amplifiers for wireless devices
and satellite solar cells. AXT’s worldwide headquarters are in
Fremont, California and includes sales, administration and customer
service functions. AXT has its Asia headquarters in Beijing, China
and manufacturing facilities in three separate locations in
China. In addition, as part of its supply chain strategy, the
company has partial ownership in ten companies in China producing
raw materials for its manufacturing process. For more information,
see AXT’s website at http://www.axt.com.
Forward-Looking Statements
The foregoing paragraphs contain forward-looking
statements within the meaning of the Federal securities laws,
including, for example, the progress, timing and estimated
completion of the proposed listing of shares of Tongmei on the STAR
Market. These forward-looking statements are based upon assumptions
that are subject to uncertainties and factors relating to the
company’s operations and business environment, which could cause
actual results to differ materially from those expressed or implied
in the forward-looking statements contained in the foregoing
discussion. These uncertainties and factors include but are not
limited to: the requests for redemptions by private equity funds in
China of investments in Tongmei, the administrative challenges in
satisfying the requirements of various government agencies in China
in connection with the listing of shares of Tongmei on the STAR
Market, continued open access to companies to list shares on the
STAR Market, investor enthusiasm for new listings of shares on the
STAR Market and geopolitical tensions between China and the United
States. Additional uncertainties and factors include, but are not
limited to: the timing and receipt of significant orders; the
cancellation of orders and return of product; emerging applications
using chips or devices fabricated on our substrates; end-user
acceptance of products containing chips or devices fabricated on
our substrates; our ability to bring new products to market;
product announcements by our competitors; the ability to control
costs and improve efficiency; the ability to utilize our
manufacturing capacity; product yields and their impact on gross
margins; the relocation of manufacturing lines and ramping of
production; possible factory shutdowns as a result of air pollution
in China or COVID-19; COVID-19 or other outbreaks of a contagious
disease; tariffs and other trade war issues; the financial
performance of our partially owned supply chain companies; policies
and regulations in China; and other factors as set forth in the
company’s Annual Report on Form 10-K, quarterly reports on Form
10-Q and other filings made with the Securities and Exchange
Commission. Each of these factors is difficult to predict and many
are beyond the company’s control. The company does not undertake
any obligation to update any forward-looking statement, as a result
of new information, future events or otherwise.
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Contacts: |
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Gary Fischer |
|
Chief Financial Officer |
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(510) 438-4700 |
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Leslie Green |
|
Green Communications Consulting,
LLC |
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(650) 312-9060 |
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