Published on: Jun 2, 2022

The Acquisition
of Beneq

As part of our ongoing research into Chinese acquisitions in Europe, Datenna decided to highlight and research remarkable cases. This case considers the acquisition of the Finnish Company Beneq.

Acquisition Cases

Short read

  • In 2018, the Finnish firm Beneq got acquired by the Chinese firm SRI Intellectual
  • Beneq is internationally known as the renowned supplier of ALD equipment for semiconductors and other related products
  • SRI Intellectual focuses on high-technology solutions and rail vehicle systems and is mostly active in the Chinese market
  • SRI Intellectual has invested about 20 million euros in Beneq ever since the acquisition and aims to extend its capacities and position in the market
  • One of the shareholders of SRI Intellectual, the CRRC Guohua Equity Investment Partnership, is for 50% owned by a Military-Civilian Development Fund
  • The other shareholder, the CRRC Qingdao Sifang Vechicle Research Institute Co. Ltd., is owned by CRRC Corporation limited, an institute directed by the State Council of the People’s Republic of China.

Beneq has now been bought by SRI Intellectual, a high-tech Chinese company focusing on high-tech solutions and rail vehicle systems.

The Acquisition

On September 28, 2018, Beneq announced that it had sold all shares to a new, Chinese owner, Qingdao Sifang SRI Intellectual Technology Co. Ltd. (SRI Intellectual). Beneq, a Finnish company founded in 2005 with its headquarters in Espoo, is known the most renowned provider of thin film Atomic Layer Deposition (ALD) equipment for semiconductor machines and related R&D, and is the number one producer of thin film electroluminescent displays globally. Beneq is mostly, yet not exclusively, active in Europe. The firm has now been bought by SRI Intellectual, a high-tech Chinese company focusing on high-tech solutions and rail vehicle systems.

View ownership tree Beneq

An Independent Firm

As mentioned, SRI Intellectual has taken up 100% of all company shares, but the financial details of the sale have remained undisclosed. Beneq was divided over other owners, amongst which the Finnish early-stage venture capital company Inventure, Danish private equity and venture capital firm Via Equity and the Finnish state-owned investment company Tesi. These companies have all exited their ownership positions. It has been emphasised by Beneq that it will remain an independent Finnish company, which will continue its production and services the same way as before the acquisition.

Expanding The Business

SRI Intellectual is said to have immensely boosted the company’s development and earnings by investing over 20 million euros in the Finnish company ever since 2018. Additionally, it has been working on extending its capacities for semiconductor related productions. To be exact, the new owner has invested 2+ million euros in building a new clean room facility that adds about 350 square meters of ISO 7 cleanroom floor space that “will be the engine for Beneq’s rapid growth in More-than-Moore markets, including power semiconductors, RF, image sensors, MEMS, compound semiconductors, LED & Micro-LED, OLED, and more” (source). The new large facility will allow for the “highest availability and new safety features”. The new ownership intents to continue its large investments into the development of the company in order to keep it up-to-date with the competition in the market.

Aside from the wish to grow Beneq to become an even larger key player in the market than it already was before the acquisition, SRI Intellectual has also regarded the acquisition as a chance to expand its own business beyond the Chinese borders, and create a base for the internationalisation of the firm.

SRI Intellectual’s Shareholder Connections

An interesting aspect of SRI Intellectual is that the firm itself is partly owned by the CRRC Qingdao Sifang Vehicle Research Institute Co., Ltd. This institute is owned by the CRRC Corporation Limited, which is a cooperation for the largest part ruled by the State Council of the People’s Republic of China. Additionally, SRI Intellectual majority shares are held by the CRRC Guohua (Qingdao) Equity Investment Fund, which for 50% is held by the Guohua Military-Civilian Integration Industry Development Fund (hereafter Military-Civilian Development Fund). This fund was established by several central military enterprises in 2016 as part of the Chinese government’s goal to invest more in the military industry and other strategic, emerging industries and grow technological knowledge in these fields.

When in 2015 the Made In China 2025 plan got introduced this goal got even more emphasis and became a leading objective in the strategy of the Chinese government. China wishes to become self-sufficient in the production of certain technologies and become a hub of innovation and high-tech development. One of the tactics that the Chinese government uses to obtain this new technological knowledge, is the acquisitions of high-tech firms abroad.

The acquisition of Beneq could potentially be an example of this. Semiconductors and related products are known to be dual-use goods: goods that can be used for civilian or military purposes. Obtaining more knowledge and production capacity in regards to such goods is part of current Chinese strategy. The fact that the Military-Civilian Development Fund has been set up by central military enterprises and is part of the CRRC shareholdership could influence the manner in which the newly occupied technological knowledge is going to be used.