Amkor Technology, the world's second-largest semiconductor packaging and testing company, is planning a major strategic restructuring—proposing to spin off its China-based packaging and testing operations and sell a majority stake in the regional assets. Amkor's China business is valued at approximately $1 billion to $1.5 billion, though the transaction remains in its preliminary planning stages.

According to prevailing market analysis, Amkor is highly likely to adopt a transaction structure involving "divestiture of controlling stake while retaining only a minority interest." Amkor has engaged professional investment banks to advance the divestiture framework and gauge potential investor interest, but the final transaction scheme has yet to be finalized.

Amkor's Presence in China

Amkor's ties to the Chinese market date back to 2001, when the company established its first packaging facility in Shanghai. In 2004, Amkor acquired a second large-scale semiconductor factory in Shanghai from IBM, continuing to expand its production capacity in China. Today, Amkor's core Chinese operating entity—Amkor Assembly & Test (Shanghai) Co., Ltd., located in Shanghai's Zhangjiang Science City—employs over 5,000 staff. It ranks as Amkor's second-largest production base globally, surpassed only by the company's Phoenix, Arizona facility. The Shanghai operation has previously achieved an annual shipment volume of 2.2 billion integrated circuit units, contributing approximately one-sixth of Amkor Group's total revenue and profit.

Strategic Rationale Behind the Divestiture

Two forces drive this business spin-off: mounting geopolitical pressure and the need for strategic focus. On one hand, U.S. semiconductor export controls against China continue to tighten. As the leading U.S.-based packaging and testing firm, Amkor faces growing difficulty in maintaining technological equilibrium between the two nations. On the other hand, Amkor is concentrating core resources on AI and advanced packaging. In June 2026, the company signed a ten-year strategic cooperation agreement with TSMC; in July, it reached a multi-year, $1.5 billion partnership with NVIDIA, targeting advanced packaging and testing technologies for next-generation artificial intelligence and accelerated computing platforms. By contrast, its China operations focus primarily on mature packaging and testing, with declining alignment to the company's future strategic direction.

Impact Outlook

Should the transaction ultimately close, existing customer orders may face a phased transition and redistribution in the near term, with domestic Chinese packaging and testing firms positioned to absorb some of the displaced demand. Over the longer term, this move will further accelerate the domestic substitution process within the packaging and testing segment, compelling local enterprises to increase R&D investment and production capacity expansion.

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