Meichang bets $178M on China's power-chip push with Lonten stake
What's the deal? Lonten Semiconductor has raised 1.205 billion CNY (roughly $178 million) in a late-stage round, with new-energy materials maker Meichang Co., Ltd. contributing 300 million CNY for a 5.729% stake. The deal, disclosed on June 30, was signed on June 29 with Lonten and its controlling shareholder, Xu Xichang.
The details: Meichang bought 12 million new shares at 25.00 CNY each. Other investors put in a further 905 million CNY at the same price — including 125 million CNY in debt-to-equity conversion — for 36.2 million shares.
Why it stands out: The round lands in the 91st percentile by size for late-stage VC deals in China, an outlier at the top end of the market.
What's the endgame? The fresh capital is meant to ease Lonten's heavy debt and continued losses while funding process and capacity upgrades. Meichang, which makes diamond wire for the solar sector, is using the deal as a financial investment to enter the power-semiconductor supply chain.
What could go wrong? Meichang will not take part in management, and the agreement carries no performance guarantee or downside protection — losses and operating risk fall entirely on the investors. Three independent directors abstained from the vote, signalling internal disagreement over the risk-reward balance.
The signal: Domestic substitution in power semiconductors, plus demand from new energy and industrial control, is driving a wave of funding and expansion in the sector. Meichang's move fits a run of A-share companies making cross-sector chip bets — a strategic wager on long-term industry momentum rather than an immediate boost to its core business.
Read more: Jiemian
Image credit: Generated with Gemini
