Sat, Jul 17, 2004 - Page 10 News List

Procomp financial scandal hurts Suntek affiliate


Suntek Compound Semiconductor Co (尚達積體電路), a chip foundry affiliate of Procomp Informatics Inc (博達科技), is on the brink of closure after its restructuring efforts were thwarted yesterday.

Hopes of improving Suntek's financial situation were dashed as a temporary shareholder's meeting called to discuss a capital-reduction proposal failed to draw the required quorum.

"We hope to solicit investors to bankroll Suntek, if we can recoup the company's finances by cutting capital," a Suntek financial executive told the Taipei Times in a phone interview.

Suntek's board of directors originally planned to cut the company's NT$3.8 billion in capital by up to 40 percent, said the execu-tive, surnamed Lee, who declined to be further named.

Other options on yesterday's agenda included a layoff of half of the firm's 270 employees and closing the plant, Lee said.

"Without the support of our major shareholders, we really don't know who to count on and what to do now. We're running out of time and out of cash," he said.

The Hsinchu-based wafer foun-dry, which supplies communications chips to Japanese consumer electronics giant Sony Corp, lost around NT$600 million on revenue of NT$100 million during the first six months of the year, Lee said.

In a last-ditch attempt to save itself, the company has approached some potential Chinese investors.

But Suntek's efforts to find potential partners may be in vain in view of its parent company's financial scandal, Lee said.

BenQ Corp (明基電通), which holds about a 15-percent stake in Suntek, sent representatives to yesterday's abortive shareholder's meeting, but the nation's largest mobile phone maker declined to comment on the possibility of closing Suntek's factory.

"We'll allocate the non-operating loss in accordance with our shareholdings," said BenQ chief financial executive Alex Liu (劉維宇).

BenQ was expected to allocate NT$90 million in losses for its investment in Suntek for the first half of the year.

According to Liu, BenQ invested about NT$500 million in Suntek in 2000, in cooperation with Suntek chairwoman Sophia Yeh (葉素菲), to form the wafer foundry.

At the time, BenQ held about 30 percent of the company's total shares.

Yeh is also the chairwoman of Procomp. She was detained last month on fraud charges.

This story has been viewed 4460 times.

Comments will be moderated. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned.

TOP top