Amkor Technology (AMKR.US), a global leader in outsourced semiconductor assembly and test services, is reportedly exploring strategic options for its China business, including a potential sale of a stake, according to sources familiar with the matter. The Tempe, Arizona-based company has engaged advisors to prepare for a possible spin-off of the unit and has begun gauging initial interest from potential buyers. The firm may retain a minority stake in the business, with the overall valuation of its China operations estimated between $1 billion and $1.5 billion. Shares of Amkor Technology have risen 34% year-to-date, bringing the company's market capitalization to $13.1 billion. However, amid volatility in AI-related stocks, the stock has retreated significantly from its June highs.

Insiders indicate that Asian investment firms and industry peers are expected to show strong interest in the asset. The discussions remain at an early stage, with no final decisions made, and details, including the valuation, are still subject to change. Representatives for Amkor Technology declined to comment on the matter.

This move positions Amkor Technology among other multinational corporations reassessing their operations in China. Last week, reports emerged that SK Hynix is exploring the introduction of investors for its Chongqing facility to accelerate growth. Additionally, fashion brand Abercrombie & Fitch, General Mills, Starbucks, and Swedish oat milk giant Oatly are also considering restructuring plans for their respective China businesses.

Amkor Technology entered the Chinese market in 2001, establishing its first packaging plant in Shanghai. In 2004, the company acquired a second large-scale semiconductor facility in Shanghai from IBM. In July, Amkor Technology announced a multi-year, $1.5 billion agreement with Nvidia (NVDA.US) to co-develop advanced semiconductor packaging and testing technologies for next-generation AI and accelerated computing platforms. Just one month prior, the company had signed a ten-year strategic cooperation framework agreement with Taiwan Semiconductor Manufacturing Company (TSM.US).