Dutch chipmaker Nexperia alleges Chinese parent company damaged value to retake control

Nexperia has accused its Chinese parent company, Wingtech, of using a “scorched earth” strategy to try to reclaim control of the Nijmegen chipmaker. A company lawyer told the Enterprise Chamber in Amsterdam that the CEO appears willing to damage the company’s value rather than compromise.

The Enterprise Chamber suspended CEO Wing Zhang in October and restricted Wingtech’s influence as a shareholder amid concerns of mismanagement. Around the same time, the Dutch government had stepped in with emergency legislation to prevent Nexperia’s production capacity and expertise from leaving Europe, though the minister subsequently lifted the intervention.

Nexperia claims that Wingtech subsequently urged the Chinese government to impose export controls on the chipmaker, which were enacted and severely affected both the company and the automotive sector. The company also alleges that Wingtech “held Nexperia’s Chinese components hostage” by halting payments and mobilizing resistance against the Dutch headquarters.

Wing, formally known as Xuezheng Zhang, did not attend the hearing. His lawyer explained that he was unable to be present and that the case had a profound personal impact on him.

The Enterprise Chamber judges will determine whether an inquiry into the alleged mismanagement, as requested by Nexperia, will proceed. If the investigation goes ahead, the CEO’s suspension and the shareholder restrictions will remain in place; if not, the measures will be lifted.

Nexperia argues that Wingtech and Wing should remain sidelined, as the company claims they continued to act against the chipmaker’s interests even after earlier interventions. The export restrictions and halted payments had created significant challenges, with revenue dropping sharply in October and November and cash outflow exceeding inflow. According to Nexperia, the company’s performance improved after that period.

Lawyers for Wingtech argued that the Chinese owner has never attempted to drain the chipmaker’s assets or relocate the company to China. Wingtech’s lawyers stated that the parent company and CEO were solely implementing precautionary steps to maintain the ability to conduct business with Nexperia amid looming U.S. restrictions.

Several parties have shown interest in taking over the company, according to Arnold Croiset van Uchelen, the court-appointed manager of nearly all Nexperia shares, who mentioned this in the Enterprise Chamber, without disclosing the identities of the interested parties.

During Wednesday’s hearing, Croiset van Uchelen emphasized that he does not have the authority to decide on a potential sale of Nexperia, which remains owned by Wingtech. “Up to now, Wingtech has stated that it does not wish to engage in discussions with these parties,” he told the judges.

Croiset van Uchelen stated that he and Guido Dierick, the Nexperia director appointed by the Enterprise Chamber, have recently held direct talks with Wingtech. The talks focus on finding a solution to the ongoing Nexperia dispute and may also involve outside investors.

Croiset van Uchelen stressed that the top priority is repairing the supply chain connecting Nexperia’s European operations with a large factory in Dongguan, China. He noted that the strained relationship between these units is detrimental to everyone involved.