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Chou Chin chair Kuo resigns

Chou Chin Industrial Co (久津實業), a maker of juices, tea and coffee, said its chairman and president Kuo Bao-fu (郭保富) resigned after a report he is being probed for alleged breach of faith and failing to settle stock-trading accounts.

After a day of questioning by the Investigation Bureau, Kuo admitted yesterday embezzling NT$200 million (US$6 million) and gave the money to a person identified only as Yu, a Chinese-language newspaper reported, citing the bureau.

The bureau released Kuo on a NT$2 million bail yesterday to settle Chou Chin's NT$3 billion worth of loans, the newspaper also said.

The investigations came after the media reported last week investors didn't settle about NT$2 billion worth of trades, making the stock settlement default the largest in almost five years.

Yageo may post another loss

Yageo Corp (國巨), the country's biggest maker of parts used to control the flow of electricity in electronic products, will probably post its fourth straight quarterly loss because of a supply glut.

Yageo may turn to a fourth-quarter loss of NT$155.6 million (US$4.5 million) from NT$37.6 million profit a year ago, a Bloomberg survey of five analysts showed. Sales, based on monthly reports, edged up 3 percent to NT$3.7 billion. Yageo will announce results tomorrow after the stock market closes at 1:30pm.

The company, which makes capacitors and resistors for personal computers and mobile phones, forecast fourth-quarter prices will fall as much as 9 percent from the third quarter.

"There have been serious overcapacity problems," said Evelyn Ou, an analyst with Morgan Stanley & Co. "Demand has been sluggish."

Yageo in May had its credit rating cut to "twBBB-" by Taiwan Ratings Corp, four levels below investment grade. The rating covers the company's overall creditworthiness, not any particular debt issue.

Teco plans overseas acquisitions

Teco Electric & Machinery Co (東元電機), plans to buy an unidentified motor maker in the US or Europe to expand its market share in North America, a Chinese-language newspaper reported, citing Teco chairman Theodore Huang (黃茂雄).

The acquisition, expected to complete within six months, would raise the sales of industrial motors next year to NT$30 billion (US$866 million), the newspaper said, without giving a comparative figure.

The company also plans to buy three motor companies in China, the paper said.

Hon Hai building Hungary plant

Hon Hai Precision Industry Co (鴻海精密), is building a factory in Budapest, Hungary to meet demand for cellphones from Nokia Oyj, a Chinese-language newspaper said, without indicating where it got the information.

Hon Hai gained Nokia, the world's largest handset maker, as a customer by making cases for phones and will start to make more cellphone parts for the Finnish company, the report said.

The company is getting more orders from Nokia and other handset makers by setting up global manufacturing operations that include factories in China, the world's biggest mobile-phone market, the report said.

Hon Hai said last month's sales rose to NT$16.8 billion from NT$13.1 billion a year ago. Last year, the company's sales rose by more than four-fifths from 2001.

NT dollar strengthens

The new Taiwan dollar gained against the US dollar on the Taipei Foreign Exchange Monday, adding NT$0.043 to close at NT$34.597. A total of US$320 million changed hands.
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