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The decision is the latest blow to Rishi Sunak’s hopes of reviving Britain’s microchip industry. It follows criticism of the Prime Minister’s £1bn semiconductor strategy, which has been dismissed by experts as insubstantial. London also suffered a severe setback earlier this year when British microchip behemoth Arm said it would float in New York instead.
Pragmatic, set up in 2010, makes low-cost and flexible microchips for use in items such as packaging and clothing.
It has been backed by the GCHQ-linked National Security Strategic Investment Fund and Future Fund Breakthrough, set up by Mr Sunak in 2021, as well as the CIA’s venture capital fund In-Q-Tel. In total the company has raised around £143m from investors including Arm, Britain’s biggest chip company.
Mr White has said that the company could follow Arm and float in the US. It is currently raising funds from private backers, with investment bank Lazard understood to be offering advice, but expects to go public the next time it raises cash.
Mr White said that Pragmatic had always planned to expand into the US beyond the company’s two existing UK sites. It ultimately plans to open hundreds of small facilities around the world.
He said that Pragmatic was applying for funding under the US Chips Act, which provides $39bn in manufacturing subsidies and requires a US-incorporated entity.
In contrast, Britain’s long-awaited chip strategy, published in May, did not set out details of how it would support manufacturers.
Mr White said: “In the areas that we do have a distinct advantage in the UK, like our technology, if we want that to continue to scale in the UK, that’s only going to happen if there isn’t an incentive for us to go build elsewhere.”
He said that Pragmatic hoped to remain headquartered in the UK, adding: “We’d like as much as possible to have the critical mass of the business remain in the UK.
“As long as we have the right support and the right intent here.”
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