Stock market launch delayed
The launch of an alternative stock market in Shenzhen, called the Chinese Growth Enterprise Market (GEM), had been expected to prompt a flood of fabless IC Initial Public Offerings (IPOs) in 2008. However, the GEM was not introduced this year because of the current global financial crisis.

"iSuppli expects more than 100 Chinese IC companies to disappear within the next two years," Gu warned. "Many companies presently are seeking buyers and a total of four companies already have been acquired by foreign semiconductor firms during the past 12 months.

China's fabless IC industry is polarised with about 50 companies achieving success and the remainder struggling to survive. Some companies are losing money and have no mature products available to deliver the revenues needed to continue doing business. Most companies have announced layoffs, cut production lines or have shut down entirely."

On the other hand, there are expected to be several Chinese fabless firms that will be seeking IPOs on the NASDAQ and domestic stock exchanges during 2009. iSuppli expects that at least five companies will seek IPOs and at least 10 companies will be involved in mergers next year.