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Siliconware shares soar as management raises stake

Siliconware shares soar as management raises stake

Taipei, Sept. 25 (CNA) Shares of Siliconware Precision Industries Co. (??) soared Friday, outperforming the broader market as investors took cues to buy from a move by the integrated circuit packaging and testing services provider's management team to raise its stake in the company, dealers said. The increase in the shareholding by Siliconware's management showed their determination to fend off possible intervention by Advanced Semiconductor Engineering Inc. (ASE, ???), which has completed a tender offer to take a nearly 25 percent stake in Siliconware, the dealers said. Shares of Siliconware closed up 3.95 percent to close at NT$39.50 (US$1.20) with 21.26 million shares changing hands on the Taiwan Stock Exchange. The weighted index on the main board ended up only 0.11 percent, although the central bank cut its key interest rates by 0.125 percentage points a day earlier. The stock opened higher in the wake of the move by Siliconware Chairman Bough Lin (???) and other executives to boost their holdings in the company in a bid to reinforce their influence in the company's operations, the dealers said. The strength of the stock continued until the end of the session, while the broader market suffered some selling to limit the upturn as investors rushed to pocket their earlier gains, they said. Since late August, Lin and other executives of Siliconware have spent more than NT$2 billion to buy an additional 50 million Siliconware shares after ASE launched a tender offer to buy a stake in the company on Aug 24. The tender offer was completed Sept. 22, allowing ASE to take a 29.44 percent stake in Siliconware. Although ASE has promised not to intervene in Siliconware's operations after the acquisition, Lin and his management team still intensified their efforts to strengthen their power in the company against possible intervention by ASE in the future. Market sources said that Lin himself spent about NT$1.03 billion on 93 million Siliconware shares in recent sessions so that Lin's stake has increased to almost 3 percent from 2.2 percent recorded in July. The sources said that Siliconware's management team could hold a nearly 15 percent stake in the company for now, compared with ASE's 25 percent. The delivery of the 25 percent Siliconware stake ASE acquired through the tender offer is scheduled to be competed Sept. 30, making ASE the largest shareholder of Siliconware. To counter ASE's tender offer, Siliconware and Hon Hai Precision Industry Co. (??) announced Aug. 28 that they would conduct a stock swap by issuing new shares. After the stock swap is done, Hon Hai is expected to hold a 21.24 percent stake in Siliconware to become the latter's largest shareholder, while Siliconware will hold a 2.2 percent stake in Hon Hai. As ASE's stake in Siliconware is expected to be diluted to a level of below 20 percent after the stock swap, ASE has voiced its opposition to the deal with Hon Hai. Siliconware has scheduled a special general meeting for Oct. 15 to secure approval from shareholders for the deal with Hon Hai. In a statement released Thursday, Siliconware said that the alliance with Hon Hai aims to develop the advanced system-in-package technology, and since ASE will be one of the competitors of the Siliconware-Hon Hai alliance, it is not appropriate for ASE to comment on the deal, to avoid conflict of interest. (Jalen Chung and Frances Huang)


Updated : 2021-07-30 18:35 GMT+08:00