Compal Electronics Inc

Semtech Corporation has agreed to sell its cellular module business to Compal Electronics for $62 million in cash, subject to customary adjustments. The transaction, approved by both companies' boards, includes substantially all assets and operations of the business, along with associated intellectual property, customer relationships, and personnel. Semtech CEO Hong Hou said the divestiture sharpens the company's focus on data center and LoRa connectivity. The deal is expected to close in the fourth quarter of Semtech's 2027 fiscal year, pending regulatory approvals and other customary conditions. UBS Investment Bank served as financial advisor and O'Melveny & Myers LLP as legal counsel to Semtech.

Compal Electronics opened its Daxi AI Server Manufacturing Center in Taoyuan, Taiwan, marking a significant expansion of its AI server production capacity. The facility, representing a total investment of NT$4.03 billion, will focus on AI server system and rack-level solutions, with production expected to begin contributing revenue in the fourth quarter of 2026. The new center is set to double Compal's AI server system production capacity and add new rack manufacturing capabilities, complementing existing sites in Taiwan, Vietnam, and the United States. Chairman Ray Chen stated that the company is accelerating its transformation into an AI-centric business, with customer expansion into the NeoCloud segment driving server business growth, and expressed confidence in the AI server business momentum for 2027.