Kingston Technology Company Inc. is selling one of its technology subsidiaries to a Chinese firm.
Kingston's fully-owned subsidiary, Payton Shenzhen Company Ltd., will be acquired by Shenzhen Kaifa Technology Company Ltd. for an undisclosed sum.
Kaifa will assume a 100% equity stake in Payton. The agreement and transfer of equity will be complete once all of the relevant Chinese government agencies provide final approval.
Since 1999, Payton has provided back-end wafer processing capabilities and supply chain management for Kingston. As an equity transfer, there are no changes planned at this time to Payton Shenzhen's operational management. The company will continue to operate as it has in the past and Kingston will continue to assist Payton in most major aspects of its business.
The deal allows Payton to expand its efforts into wider areas for semiconductor packaging and testing as the computer industry changes and expands in new directions. The agreement allows Payton to grow its business within China through attracting local customers and possible future capital injections.