TOKYO : A fund backed by Japan's government has offered to buy out JSR Corp., a firm central to the manufacture of semiconductors, in a deal worth $6.2 billion, the company said Monday.

JSR said in a statement its board was in favour of the deal, which would privatise a company that is a key producer of compounds vital to the manufacture of semiconductors.

Japan Investment Corporation (JIC), the fund behind the deal, hopes to finalise it by December, but there are regulatory procedures that make a precise timeline hard to predict, JSR said.JIC is an investment fund founded in 2018, with the government as the majority investor along with smaller private-sector partners.

The 0.9 trillion yen offer comes as Tokyo, along with many governments, tries to stabilise supply chains for the chips that are central to the modern economy.Pandemic disruption and tensions with China have raised concerns globally about the risks in existing chip supply chains.Countries from France to Israel have been looking for ways to incentivise chip-making at home, or take greater control of production.JSR is a market leader in the manufacture of materials including photoresists for circuit formation, which are central to producing semiconductors.

It controls around 30 percent of the global market for photoresists, according to Bloomberg, and along with two other Japanese firms almost completely dominates production of two other key ingredients used to make displays and chips.Rumours of the possible acquisition deal had been circulating for days, and JSR stock closed up 21.64 percent to 3,934 yen ahead of the company's announcement.