Note 6. Investments in Privately-held Companies

We have made strategic investments in private companies located in China in order to gain access at a competitive cost to raw materials that are critical to our substrate business.

Our investments are summarized below (in thousands):

	Investment Balance as of
	March 31,		December 31,		Accounting	Ownership
Company	2014		2013		Method	Percentage
Beijing JiYa Semiconductor Material Co., Ltd.	$	3,331	$	3,331	Consolidated		46	%
Nanjing Jin Mei Gallium Co., Ltd.		592		592	Consolidated		83	%
Beijing BoYu Semiconductor Vessel Craftwork Technology Co., Ltd.		1,346		1,346	Consolidated		70	%
	$	5,269	$	5,269

Donghai County Dongfang High Purity Electronic Materials Co., Ltd.	$	1,867	$	1,900	Equity		46	%
Xilingol Tongli Germanium Co. Ltd.		4,849		4,692	Equity		25	%
Emeishan Jia Mei High Purity Metals Co., Ltd.		925		945	Equity		25	%
	$	7,641	$	7,537

Our ownership of Beijing JiYa Semiconductor Material Co., Ltd. (JiYa) is 46%. We continue to consolidate JiYa as we have significant influence in management and have majority control of the board. Our Chief Executive Officer is chairman of the JiYa board, while our president of China operations, our vice president of China administration and our vice president of wafer production are also members of the board.

Our ownership of Nanjing Jin Mei Gallium Co., Ltd. (Jin Mei) is 83%. We continue to consolidate Jin Mei as we have significant influence in management and have majority control of the board. Our Chief Executive Officer is chairman of the Jin Mei board, while our president of China operations and our vice president of China administration are also members of the board.

Our ownership of Beijing BoYu Semiconductor Vessel Craftwork Technology Co., Ltd. (BoYu) is 70%. We continue to consolidate BoYu as we have a significant influence in management and have majority control of the board. Our Chief Executive Officer is chairman of the BoYu board, while our president of China operations and our vice president of China administration are also members of the board.

Although we have representation on the boards of directors of each of these companies, the daily operations of each of these companies are managed by local management and not by us. Decisions concerning their respective short term strategy and operations, any capacity expansion and annual capital expenditures, and decisions concerning sales of finished product, are made by local management with some inputs from us.

During the three months ended March 31, 2014 and 2013, the three consolidated joint ventures generated $0.8 million and $1.3 million of income, respectively, of which $205,000 and $441,000, respectively, were allocated to minority interests, resulting in $548,000 and $852,000 of income, respectively, to our net income (loss).

For the three minority investment entities that are not consolidated, the investment balances are included in "other assets" in our condensed consolidated balance sheets and totaled $7.6 million and $7.5 million as of March 31, 2014 and December 31, 2013. We own 46% of the ownership interests in one of these companies and 25% in each of the other two companies. These three companies are not considered variable interest entities because:

all three companies have sustainable businesses of their own;

our voting power is proportionate to our ownership interests;

we only recognize our respective share of the losses and/or residual returns generated by the companies if they occur; and

we do not have controlling financial interest in, do not maintain operational or management control of, do not control the board of directors of, and are not required to provide additional investment or financial support to any of these companies.

We also maintain minority investments in privately-held companies made indirectly through our consolidated joint ventures. These minority investments are accounted for under the equity method in the books of our consolidated joint ventures. As of March 31, 2014 and December 31, 2013, our consolidated joint ventures included these minority investments in "other assets" in the condensed consolidated balance sheets with a carrying value of $3.4 million.

All of the minority investment entities that are not consolidated and accounted for under the equity method had the following summarized income information (in thousands) for the three months ended March 31, 2014 and 2013.

	Three Months Ended March 31,
	2014		2013

Net Sales	$	13,480	$	9,273
Gross profit		3,963		3,124
Operating income		2,664		1,614
Net income		2,119		1,295

Our gross entity earnings from all the minority investment entities that are not consolidated and accounted for under the equity method were $487,000 and $282,000 for the three months ended March 31, 2014 and 2013, respectively.

We also maintain minority investments directly in one privately-held companies accounted for under the cost method and we do not have the ability to exercise significant influence over their operations. As of March 31, 2014 and December 31, 2013, our investments in this unconsolidated privately-held company had a carrying value of $200,000 and are included in "other assets" in the condensed consolidated balance sheets.