Hon Hai Group (
"We do have a very high interest in [acquiring Chi Mei Communication] ? and we are in talks with them right now," said Edmund Ding (
Hon Hai hopes to seal the deal by the end of the current quarter, as the handset maker's design ability and customer mix make it an ideal merger target, Ding said in a phone interview yesterday.
He, however, shied away from elaborating on the terms of the proposed deal.
Chi Mei yesterday also confirmed the talks with Hon Hai.
But Jack Lin (
"We prefer a candidate that can promise to keep our handset-design group intact after the takeover," said Lin, who declined to give further details.
Foxconn International Holdings (
Chi Mei Communication, with paid-in capital of NT$1.5 billion, was established in 2001, mainly to produce high-end handsets and smart phones for Motorola Inc. Motorola accounts for up to 80 percent of the contract maker's annual shipment of over 2 million units.
"Hon Hai is expected to benefit from the merger deal in strengthening its design capability as well as technology to produce high-end smart phones," said an analyst at UBS Securities Ltd's Taiwan Branch, who spoke on condition of anonymity.
Although many competitors, including Lite-On Technology Corp (
Foxconn is expected to ship over 25 million handsets to its two major clients Motorola and Nokia Oyj this year. The company, which debuted on Hong Kong's bourse earlier this month, aims to challenge the Singapore-based Flextronics International to be the world's No. 1 handset maker, the company's president Tai Feng-shu (
Shares of Foxconn were boosted by the news of M&A talks, while shares of Compal Communication Inc (
Foxconn's shares soared by 3.8 percent to HK$4.1 yesterday, while Compal Communication fell 0.81 percent to NT$62.5.
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