Despite the possibility of creating a major rival for the telecom industry's two major players, the proposed merger on Thursday between Far EasTone Telecom-munications Co (遠傳電信) and KG Telecommunications Co (和信電訊) must overcome many obstacles, analysts said.
"The proposed partnership will certainly help strengthen Far EasTone's market position, lower its operating costs and boost its sales," said Gary Lai (賴晴風), an analyst at Insight Pacific Investment Research (月涵證券) in Taipei.
"But these benefits won't surface until the new company cuts redundant staff and rearranges its services," Lai said.
Far EasTone announced on Thursday that it would spend about NT$30 billion in a cash-and-stock swap to take over smaller rival KG Telecom.
"Currently, investors are still conservative [about buying Far EasTone shares] as they understand it may take a while for Far EasTone to profit from the merger," Lai said.
Far EasTone now faces a challenge after the merger -- the largest in the nation's telecom industry -- in terms of restructuring, another market watcher said.
"Management realignment and resource integration are not easy tasks for the new company," said Andy Chang (張書評), a telecom analyst at Yuanta Core Pacific Securities Corp (元大京華證券). "In addition, laying off employees is a must for the company if it wants to enhance efficiency."
Far EasTone has 2,500 employees, while KG Telecom employs nearly 1,300 people. Chang said that surplus equipment maintenance staff, customer service representatives and administrative officials are likely to be given pink slips.
Meanwhile, Chang said KG Telecom's well-known "i-mode" multimedia mobile data service may continue to operate while Far EasTone's "i-style" may become history, as the new company need not offer redundant services to customers.
In addition, "i-mode" enjoys a good global reputation, and Japan-based NTT DoCoMo remains highly interested in Taiwan's market, he said. The Japanese telecom giant owns 21 percent of KG Telecom's shares, and is expected to hold 4.8 percent of Far EasTone's shares after the merger.
Shares of Far EasTone closed at NT$0.2, or 0.8 percent to NT$22.4 on the Gre Tai Securities Market (櫃台買賣中心) yesterday.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
Thousands of parents in Singapore are furious after a Cordlife Group Ltd (康盛人生集團), a major operator of cord blood banks in Asia, irreparably damaged their children’s samples through improper handling, with some now pursuing legal action. The ongoing case, one of the worst to hit the largely untested industry, has renewed concerns over companies marketing themselves to anxious parents with mostly unproven assurances. This has implications across the region, given Cordlife’s operations in Hong Kong, Macau, Indonesia, the Philippines and India. The parents paid for years to have their infants’ cord blood stored, with the understanding that the stem cells they contained