The scrapping of the nation's first merger between two financial holding companies -- Taishin Financial Holding Co (台新金控) and Shin Kong Financial Holding Co (新光金控) -- was a wise decision, one economist said yesterday.
"The merger plan shouldn't have been implemented just for the sake of consolidation," said economist-turned-lawmaker Thomas Lee (
The merger plan was officially aborted late Wednesday, eight days after its initiation.
Interestingly, the deal was a family affair between two brothers: Taishin Financial's Chairman Thomas Wu (
Thomas Wu decided to scrap the deal after Eugene Wu earlier on Wednesday revised Shin Kong Financial's profit forecast for the year downward, from an initial NT$3.96 billion gain to an after-tax loss of NT$8.82 billion.
Moreover, Shin Kong Life Insurance (
The total market value for the three Shin Kong buildings are estimated to be at least NT$15 billion, according to local Chinese-language newspapers.
Shin Kong Financial's financial problems apparently rattled Taishin Financial's confidence in the merger plan and both companies' stock performance during the past few days, said William Fong (方偉昌), a banking analyst at PrimAsia Securities Co.
"As declining interest rates are hurting Shin Kong Life's ability to pay the higher returns that were guaranteed by policies which were sold earlier, the recent stock development has placed Shin Kong in a disadvantageous situation," Fong said.
Fong said the move to temporarily halt the merger plan is positive for both companies.
"The timing for such a merger may not be ripe yet. Both of them need to think about the planned merger one more time," Fong said.
Shares of Taishin Financial and Shin Kong Financial rose slightly yesterday by NT$0.4 and NT$0.3 to close at NT$17.9 and NT$14.6, respectively, signaling investors' positive reaction to the decision.
A Shin Kong Financial official said yesterday that the company wants to continue communicating with Taishin about the merger plan.
"There may still be room for cooperation. We'll make the final decision that is in the best interests of the shareholders," Shin Kong spokesman Lu Jung (
But Taishin was pessimistic about Shin Kong's sale of properties, saying the return may not cover losses, considering the current sluggish state of the real estate market.
The local media had therefore speculated that the merger plan was dead in the water since both sides disagreed on several issues.
With an approval rating of just two percent, Peruvian President Dina Boluarte might be the world’s most unpopular leader, according to pollsters. Protests greeted her rise to power 29 months ago, and have marked her entire term — joined by assorted scandals, investigations, controversies and a surge in gang violence. The 63-year-old is the target of a dozen probes, including for her alleged failure to declare gifts of luxury jewels and watches, a scandal inevitably dubbed “Rolexgate.” She is also under the microscope for a two-week undeclared absence for nose surgery — which she insists was medical, not cosmetic — and is
CAUTIOUS RECOVERY: While the manufacturing sector returned to growth amid the US-China trade truce, firms remain wary as uncertainty clouds the outlook, the CIER said The local manufacturing sector returned to expansion last month, as the official purchasing managers’ index (PMI) rose 2.1 points to 51.0, driven by a temporary easing in US-China trade tensions, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The PMI gauges the health of the manufacturing industry, with readings above 50 indicating expansion and those below 50 signaling contraction. “Firms are not as pessimistic as they were in April, but they remain far from optimistic,” CIER president Lien Hsien-ming (連賢明) said at a news conference. The full impact of US tariff decisions is unlikely to become clear until later this month
GROWING CONCERN: Some senior Trump administration officials opposed the UAE expansion over fears that another TSMC project could jeopardize its US investment Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is evaluating building an advanced production facility in the United Arab Emirates (UAE) and has discussed the possibility with officials in US President Donald Trump’s administration, people familiar with the matter said, in a potentially major bet on the Middle East that would only come to fruition with Washington’s approval. The company has had multiple meetings in the past few months with US Special Envoy to the Middle East Steve Witkoff and officials from MGX, an influential investment vehicle overseen by the UAE president’s brother, the people said. The conversations are a continuation of talks that
CHIP DUTIES: TSMC said it voiced its concerns to Washington about tariffs, telling the US commerce department that it wants ‘fair treatment’ to protect its competitiveness Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reiterated robust business prospects for this year as strong artificial intelligence (AI) chip demand from Nvidia Corp and other customers would absorb the impacts of US tariffs. “The impact of tariffs would be indirect, as the custom tax is the importers’ responsibility, not the exporters,” TSMC chairman and chief executive officer C.C. Wei (魏哲家) said at the chipmaker’s annual shareholders’ meeting in Hsinchu City. TSMC’s business could be affected if people become reluctant to buy electronics due to inflated prices, Wei said. In addition, the chipmaker has voiced its concern to the US Department of Commerce