NXP Semiconductors Debt Funding Round, January 2025

Eindhoven-based NXP Semiconductors N.V., a prominent semiconductor company specializing in solutions for embedded applications, has announced a €1 billion loan agreement with the European Investment Bank (EIB). The loan, which has a six-year duration, carries an interest rate of approximately 4.75% for dollar-denominated tranches under current market conditions.

This significant financing aims to strengthen the European semiconductor ecosystem, aligning with the EU Chips Act, the Dutch Semicon Valley, and the Netherlands’ National Technology Strategy. It is expected to bolster Europe’s competitiveness in the semiconductor supply chain and support advancements in critical technologies.

EIB Vice President Robert de Groot highlighted the importance of this investment: “It is fundamental for Europe to remain an indispensable player in the value chain of critical technologies and build RDI and production capacity in those supply chains. Luckily, the EU boasts some of the world’s most advanced chip makers. As semiconductors are key to the digital and green transitions, their importance will only grow, and the EIB proudly supports such strategic technology.”

The funds will enable NXP to focus on the research and development of power electronics devices, microprocessors, microcontrollers, and energy efficiency improvements. These activities will be carried out at the company’s facilities across Austria, France, Germany, the Netherlands, and Romania, extending until 2026.

NXP’s research and development teams in Europe specialize in various cutting-edge technologies, including:

- Automotive processors and radar solutions

- Energy and driver systems

- In-vehicle networking and secure car access

- Intelligent edge technologies such as artificial intelligence and secure edge identification

- NFC wallets for mobile devices and wearables

- Solutions supporting sustainability efforts

The funding also complements the EIB’s “Strategic Tech-EU” investment programme, which seeks to advance digitalization and innovation in critical technologies, including artificial intelligence, microchips, life sciences, and quantum computing. NXP Semiconductors provides solutions for key markets, including automotive, industrial and IoT, mobile, and communications infrastructure. The company operates in over 30 countries and reported $13.28 billion in revenue in 2023. Its European operations play a crucial role in developing system solutions for the connected world, combining advanced technology and sustainability.

Maarten Dirkzwager, Executive VP and Chief Strategy Officer at NXP, underscored the strategic importance of this loan: “NXP is committed to strengthening Europe’s semiconductor ecosystem, and this significant loan from EIB aims at bolstering NXP’s efforts in research and development across many of our EU sites. NXP’s collaboration with the EIB underscores our commitment to ensuring European technology leadership and sustainability in the global semiconductor market.”

The loan aligns with other European initiatives such as the Important Projects of Common European Interest (IPCEI) and supports NXP’s investment in the ESMC joint venture fab under construction in Germany, which is expected to address Europe’s automotive and industrial chip requirements.

The European Investment Bank (EIB) is the EU’s lending institution, owned by its Member States, with the Netherlands holding a 5.2% share. Over the past decade, the EIB has provided over €27 billion for projects in the Netherlands across sectors including research and development, mobility, water, healthcare, and SMEs. This latest loan reinforces its role in supporting strategic investments in Europe’s technology landscape.

By securing this funding, NXP Semiconductors takes a significant step toward reinforcing its position in the global semiconductor market while contributing to the development of Europe’s chip ecosystem. The initiative also highlights the EIB’s commitment to fostering innovation and sustainability in critical industries.