Korean PE firm acquires Achronix Semiconductor via SPAC merger

South Korea-based private equity firm Ace Equity Partners has acquired Achronix Semiconductor Corp., a US-based fabless company, through a special purpose acquisition company (SPAC) merger.

It marks the first time for a Korean PE firm to set up a SPAC on the Nasdaq to acquire a US-based company.

Achronix, with a post-transaction equity value of $2.1 billion, will merge with ACE Convergence Acquisition Corp., a $230 million blank check firm set up by Ace Equity Partners. The new entity will begin trading on the Nasdaq in mid-March following the merger completion, according to the company on Jan. 8.

Founded in 2004, Achronix is one of the top five global fabless semiconductor companies and the only independent supplier of high-performance field programmable gate arrays (FPGA). The profitable company is a key player in the global FPGA market alongside Intel Corp. and Xilinx.

The Silicon Valley-based FPGA maker's revenue in 2018 stood at around 67 billion won ($61.2 million), which surged to 115 billion won in 2020. This year, Achronix is expected to post 173 billion won in revenue.

Given its specialty in high volume and high speed data processing, FPGAs are widely used for data centers, artificial intelligence, machine learning and 5G.

The FPGA industry grabbed investors’ attention when Intel acquired programmable chip maker Altera in 2015 for approximately $16.7 billion, followed by Advanced Micro Devices (AMD) acquiring the leading FPGA maker Xilinx for $35 billion last year.

Ace Equity was founded in 2017 by David Ko, a former SkyLake Investment director. The firm invests in industrial technologies such as IT, 5G, semiconductors and secondary batteries. 

The PE firm’s core portfolio includes Tesna, a domestic semiconductor testing service and solutions provider, and Canada-based Preciseley Microtechnology Corp., a micro-electro-mechanical systems (MEMS) company.

Write to Ri-an Kim at knra@hankyung.com
Danbee Lee edited this article.