An Ottawa semiconductor firm that attracted international attention for improving the efficiency of solar panels and power storage technology has been acquired by a Chinese electronics giant.
Solantro Semiconductor, which develops power management chipsets popular in the renewable energy sector, said Friday that it has been purchased by semiconductor manufacturer Huada (HDSC).
Terms of the deal, which has already closed, were not made public.
Shanghai-based Huada is a subsidiary of China Electronics Corp., one of the country’s largest telecoms. The deal gives Huada its first Canadian footprint as its expands its portfolio of semiconductor firms.
“Huada recognized the value of Solantro’s innovative power management technology,” Solantro vice-president of finance Des Hickey told OBJ on Friday.
Founded in 2009, Solantro has garnered attention for the efficiency of its power management and energy conversion chipsets, raising $21 million in financing between its series-A round in 2012 and series-B in 2015. The company also received nearly $8 million in grants and loans from the governments of Ontario and Canada in 2013.
Hickey, who has been with Solantro from the start, says the acquisition extends the firm’s reach, allowing it to deploy its tech as part of a much larger company.
Federal government vetted the deal
The acquisition comes at a controversial time for Chinese telecom operators in Canada.
In one of the most high-profile cases, Shenzhen-based Huawei has been under increasing scrutiny from Canada and other western governments, with officials seeking to limit the Chinese firm’s exposure to critical internet infrastructure over concerns about espionage. Huawei, which has a sizeable R&D presence in Kanata, has maintained that such fears are unfounded.
Hickey says the Solantro-Huada deal has been vetted by the Canadian government, which confirmed to Solantro that there were no security concerns to address. Hickey adds that intellectual property from Solantro’s product development to-date will remain in Ottawa after the acquisition.
Huada’s CEO Haoran Dong said in a statement that purchasing Solantro aligns with the firm’s goal to build up its international engineering expertise.
“HDSC looks forward to forging partnerships across the community, establishing and growing its presence in Ottawa, as well as contributing to the city’s strong technology ecosystem, thereby generating economic and social benefits for Canadians and shareholders alike,” he said.
Hickey expects that the firm’s 30 employees, most of whom are in engineering roles, will remain in Ottawa.
Negotiations had been ongoing for “quite some time,” Hickey said, with the two companies’ relationship beginning after a Solantro board member made an introduction to Huada.
Hickey credits Invest Ottawa with helping to position the nation’s capital as an attractive place to build a business; Solantro founder Antoine Paquin travelled to China alongside a delegation from the economic development agency a few years back.
Paquin, a colourful and ambitious entrepreneur, died last year but remains close to the heart of the company he left behind.
“We were all saddened to lose a founder and a friend,” Hickey said.
"Antoine would be pleased that the company he founded will remain in Ottawa, the staff will continue to be employed and work will continue on the world-class technology he envisioned."
The serial entrepreneur made waves in the Ottawa tech scene with several companies, building and later selling firms such as Skystone Systems and Philsar Semiconductor. His passion for startups and the Ottawa community earned him the admiration of his contemporaries.
As the executive team takes Paquin’s last venture into its next stage, Hickey believes his longtime colleague would approve of the company’s direction.
“Antoine would be pleased that the company he founded will remain in Ottawa, the staff will continue to be employed and work will continue on the word-class technology he envisioned,” he said.