Ho Shou-chuan (
Ho's win, after a marathon meeting that lasted over 10 hours, is expected to expedite merger talks between SinoPac Financial and the International Bank of Taipei (IBT,
Ho and his supporters, who have about a 17 percent stake in the nation's No. 10 financial holding company, grabbed seven of SinoPac's 11 board seats. The current chairman, Richard Hong (洪敏弘), with around a 10 percent stake, took the remaining four seats.
Hong, who favors a partnership with Taishin Financial Holding Co (
The government has vowed to reduce the number of the nation's financial holding companies to seven from the current 14 by the end of next year in a bid to improve competitiveness.
SinoPac's new board is expected to elect a new chairman sometime within the next 15 days, in accordance with the Corporate Law (
Yesterday, Yuen Foong Yu also secured two superintendent seats and won the most shareholder votes, which gives it the right to convene the board meeting to elect a new chairman.
But according to Yuen Foong Yu's vice president of corporate and public relations Juliana Liu (
Ho would have to resign as chairman of Yuen Foong Yu and IBT to become SinoPac's chairman, according to the Financial Holding Company Act's (金融控股公司法) regulations.
The win by Ho's supporters has also put an end to a drawn-out rivalry within SinoPac's management, which split into two groups: one led by Hong and the other led by SinoPac's president Paul Lo (
Previously, IBT had proposed to merge with SinoPac with a share-swap ratio of 1 for 1.25 to 1.3 SinoPac shares. Taishin meanwhile offered to pay NT$23.50 a share, or a 35 percent premium, to buy SinoPac, which is equivalent to about US$2.9 billion, consisting of as much as 40 percent in cash with the remainder to be paid in shares.
The keen rivalry between the two groups sparked competition to solicit proxy votes and led to a record-high attendance ratio at the shareholder meeting yesterday, with 96.93 percent of shareholders in attendance, higher than the market's expectation of around 90 percent.
SinoPac had assets of NT$599 billion as the end of last year. Once the proposed merger with IBT is completed, the new entity would see total assets topping NT$1 trillion, making it the nation's eighth largest financial service provider.
"Longer term, as a bank-centric financial holding company, the new SinoPac will experience stronger growth momentum being generated by a higher economy of scale and revenue and cost synergies. It is estimated that the new SinoPac will be able to drive its ROE [return on equity] up to 15 percent or higher in 2007," SinoPac's spokesman and executive vice president Kevin Peng (
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