AMEC Shares Surge After U.S. Department of Defense Removes Blacklist

Shares of Chinese chipmaking equipment maker AMEC rose sharply on Wednesday after the U.S. Department of Defense removed the firm from a U.S. blacklist over its alleged ties to the Chinese military.

AMEC, formally known as Advanced Micro Fabrication Inc (SS:688012), surged nearly 4% in Shanghai trade to 198.40 yuan.

The Pentagon announced that AMEC and IDG Capital had been removed from the blacklist in an amendment released on Wednesday. This blacklist includes "Chinese military companies," notably entities accused by the U.S. of supplying the People’s Liberation Army.

AMEC had vehemently opposed this classification and had sued the U.S. government in August to be excluded from the list. The company had previously been added to the list in January 2021, removed by June 2021, and then added back at the beginning of 2024.

Other notable companies on the blacklist include electronics giant Huawei and top Chinese chipmaker Semiconductor Manufacturing International Corp (HK:0981) and its subsidiaries.

AMEC, along with SMIC, plays a crucial role in China’s chipmaking ambitions, accounting for a significant portion of the country's foundry capacity. The company is partially state-owned and went public in 2019.

China is racing to enhance its local chipmaking capabilities, especially after being cut off from advanced U.S. chipmaking technologies that limit Beijing’s access to artificial intelligence.