SinoPac Financial Holding Co (建華金控), the nation's 10th largest financial service provider, vowed to wrap up a merger and acquisition (M&A) deal with the most likely candidate -- the International Bank of Taipei (IBT, 台北商銀) -- by the year's end, the firm said yesterday after electing a new board.
The new board also elected Edward Chien (
Chien, former chairman of Hua Nan Commercial Bank (
"SinoPac is a very nice medium-sized financial holding company with development potential ? and I hope to help its expansion [during my chairmanship]," Chien said at a press conference.
Paul Lo (
"Size matters," Lo said at the press conference, adding that it is hard for any bank to survive in Taiwan without a few key elements, including over NT$1 trillion of assets, close to 100 outlets in the greater Taipei area or more than 100 branches nationwide.
Against this backdrop, Lo said SinoPac will complete its M&A plan by the end of this year, as its foreign investors -- which hold over 33 percent of the company -- are running out of patience.
SinoPac was already in merger talks with IBT when former chairman Hong said that he preferred an alliance with Taishin Financial Holding Co (
Previously, IBT proposed to merge with SinoPac with a share-swap ratio of one of its shares 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.
Lo yesterday said that IBT is an ideal candidate, as the merger would boost SinoPac's assets to over NT$1 trillion from the current NT$600 billion.
The financial holding firm favors partnership through a share swap as this will prevent it from having to amortize any goodwill losses, especially since the company has an inadequate cash position to acquire banks at the moment, he added.
Taishin, which pressed libel charges against Lu and SinoPac's spokesman Kevin Peng (
Taishin has therefore withdrawn the charges, the statement read.
Taishin had accused Peng and Lo of sending out incorrect information in two e-mails, on April 18 and April 19, to overseas investors, saying that Taishin chairman Thomas Wu (吳東亮) was not sincere about the merger and had not made a genuine offer.