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Hon Hai unit shares jump on partnership with Siliconware

Hon Hai unit shares jump on partnership with Siliconware

Taipei, Sept 17 (CNA) Shares of ShunSin Technology Holdings Ltd. (??), an integrated circuit packaging and testing services subsidiary of Hon Hai Precision Industry Co. (??), soared Thursday morning following news that the parent company aims to work with Siliconware Precision Industries Co. (??) to develop advanced system-in-package (SiP) technology, dealers said. The current buying reflected optimism that the partnership between Hon Hai and Siliconware will help ShunSin speed up the pace of entering the SiP arena after both Hon Hai and Siliconware reiterated their ambitions a day earlier to jointly develop the technology, the dealers said. As of 12:07 p.m., shares of ShunSin had added 8.23 percent to NT$125.00 (US$3.85), with 2.13 million shares changing hands on the Taiwan Stock Exchange. The weighted index on the local main board was up 1.28 percent at 8,440.12 points. ShunSin, incorporated in the Cayman Islands, launched a primary listing on the TWSE in January after Hon Hai, the world's largest contract electronics maker, took the subsidiary public. The stock attracted strong buying soon after the local equity market opened Thursday as investors were encouraged by a plan laid down by Hon Hai and Siliconware a day earlier to intensify their efforts in the development of SiP technology in a bid to make the technology contribute significantly to Siliconware and Hon Hai in 2017. Siliconware cited a market forecast as saying that sales of the global SiP market are expected to hit US$25 billion in 2015, and to rise to US$40 billion in 2018. In a news conference held a day earlier, both Hon Hai and Siliconware emphasized that a partnership between the two companies will create visible synergy for both sides, and urged their shareholders to have faith in the strategic alliance. On Aug. 28, Hon Hai and Siliconware announced that they had reached an agreement under which Siliconware and Hon Hai will launch a stock swap by issuing new shares, with each Hon Hai share being exchanged for 2.34 Siliconware shares. After the deal is done, Hon Hai is expected to hold a 21.24 percent stake in Siliconware and become its largest shareholder, while Siliconware will hold a 2.2 percent stake in Hon Hai. The deal aims to fend off interest from Advanced Semiconductor Engineering Inc. (ASE, ???), which has launched a tender offer to buy an up-to 25 percent stake in Siliconware from the open market. Siliconware has repeatedly urged shareholders not to sell their shares to ASE. ASE said that the purchase of a Siliconware stake is simply for financial investment purposes and it will not intervene in Siliconware's management. However, Siliconware said that ASE's tender offer is paving the way for a hostile takeover. Currently, ASE is the largest IC packaging and testing services provider in the world, ahead of U.S.-based Amkor Technology Inc. and Siliconware. Siliconware Chairman Bough Lin (???) said in the Wednesday news conference that his company will apply Hon Hai's automation applications to its production lines, a move that is expected to boost Siliconware's efficiency. (By Jalen Chung and Frances Huang)


Updated : 2021-09-24 12:16 GMT+08:00