China's CXMT Corp starts IPO preparation process, document shows

By Che Pan and Brenda Goh

BEIJING (Reuters) -CXMT Corporation, parent of Chinese dynamic random-access memory chipmaker ChangXin Memory Technologies, has kicked off preparations known as "the counselling process" for an initial public offering, a document released by China's securities regulator showed on Monday.

CXMT Corp has hired China state-owned investment banks China International Capital Corporation and CSC Financial for the process, the document showed, which stopped short of details about where and when it will go public.

CXMT is one of CXMT Corp's most significant fully-owned subsidiaries, which had a registered capital of 60.2 billion yuan ($8.39 billion), according to China's business registry website Qichacha.

The document did not specify which of CXMT Corp's assets could be part of the listing or whether the listing would include the CXMT subsidiary.

CXMT did not immediately respond to a request for comment.

Founded in 2016 with state financial backing, CXMT represents China’s efforts to establish a foothold in the global market for dynamic random-access memory chips, long dominated by companies from the United States, Japan, and South Korea.

DRAM chips hold data when the power is on and are widely used in devices from smartphones to servers in data centres.

CXMT currently operates two semiconductor foundries in China. Its first facility is located in Hefei, Anhui Province. Construction of its second foundry began in Beijing in 2020, with the first phase commencing production in September 2023 and the second phase following in 2024, according to the company.

CXMT’s total monthly production capacity is estimated at around 200,000 12-inch wafers, two sources familiar with its capacity status said.

The U.S. considered placing CXMT on its Entity List in May.

CXMT avoided the trade blacklist, but remains subject to U.S. export restrictions imposed in October 2022. These measures aim to impose certain limits on China's DRAM chip manufacturing capabilities.

($1 = 7.1731 Chinese yuan renminbi)

(Reporting by Beijing Newsroom; Editing by Joe Bavier, Louise Heavens and Jane Merriman)

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