BenQ Corp (明基), a leading electronics maker in Taiwan, yesterday said it would sell its optical storage unit, including facilities and patents, to local rival Lite-On IT Corp (建興電子) for NT$1.2 billion (US$37 million) plus a 13 percent stake in the company.
The deal will make BenQ the second-largest shareholder in the nation's biggest optical-drive maker, and lift Lite-on IT's global market share to 27 percent, making it the world's second-biggest optical-drive maker.
The alliance is BenQ's latest move in the re-focusing of its brand operations, and part of its greater efforts to boost profitability and generate more cash flow by streamlining non-core product lines -- which include pulling out of the domestic digital music player market, and the farming out of more production to trim costs.
PHOTO: CHEN TSE-MING, TAIPEI TIMES
"BenQ will focus more on marketing its own-brand products in the future," the company said in a statement released yesterday.
Lite-On IT, the world's No. 5 maker of optical drives, would add BenQ to its client portfolio, which includes Japanese electronics giant Sony Corp. Lite-On IT would also pay an extra small amount of money for BenQ's equipment.
The deal will be closed by June 1, BenQ said.
"We have been adjusting [our non-core business]. We are looking for the optimal operational pattern by concentrating our resources," BenQ chairman Lee Kun-yao (李焜耀) told a press conference yesterday.
But Lee said the deal would not help the company break even ahead of schedule in the final quarter of this year.
The disk-drive unit accounted for just 6 percent of BenQ's total revenues of NT$162.3 billion last year.
"The acquisition of Siemens AG's ailing mobile device unit hastened BenQ's pace in dealing with its non-core businesses as it needs to concentrate on turning around the handset business," said Helen Chen (陳佩君), an analyst with Polaris Securities Co (寶來證券).
The latest restructuring effort means that BenQ would take a more aggressive approach to selling branded cellular phones after fixing its non-core businesses, Chen said.
"This will have a positive impact on BenQ in the long run," she said.
Mobile phones made up half of BenQ's revenues in the final quarter of last year after the purchase of Siemens AG's handset unit last July. The firm posted pre-tax losses of NT$5.3 billion, or NT$2.16 a share, for last year, dragged down by the handset unit.
For Lite-On IT, the transaction would help the company reduce the erosion of the price of DVD recorders after it receives BenQ's orders, Chen said.
The deal is expected to boost Lite-On IT's revenues for this year from between NT$5 billion to NT$10 billion, Lite-On IT president Danny Liao (廖學福) said. Last year, Lite-On IT posted around NT$50 billion in revenues.
Shares in BenQ and Lite-On IT rallied by 1.27 percent and the 7 percent daily limit, respectively, to reach NT$27.85 and NT$41.35 on the Taiwan Stock Exchange yesterday.
Cairo’s new monorail slices across the city skyline, running above the familiar chaos of blaring horns and aging buses’ exhaust fumes that mark rush hour below. The US$4.5 billion monorail, opened this month, is among Egypt’s most prominent new transport projects, part of a debt-funded infrastructure drive criticized for sapping state finances while bringing limited benefits to most of the country’s 109 million people. “It feels like you’re in a different country,” said Ramy Sayed, a restaurant manager, aboard a driverless Innovia 300 train. “No noise, no traffic, we’re not used to this.” The eastern line runs 56km from the bustling middle-class
Taiwanese firms have increased investment in the Philippines in recent years as Manila’s ties with Washington deepen and global supply chains continue to shift away from China, an expert at the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The Philippines had not been among Taiwanese investors’ top choices in Southeast Asia, CIER Taiwan ASEAN Studies Center director Kristy Hsu (徐遵慈) said at a seminar in Taipei. However, Taiwan’s investment in the country has grown significantly since the COVID-19 pandemic, reaching US $257 million last year, a high in recent years, she said. Although Taiwan’s total investment in the Philippines still lags
Starlux Airlines Co (星宇航空) today unveiled a long-haul network expansion plan at a shareholders’ meeting in Taipei, including direct flights to Barcelona, Spain, and Zurich, Switzerland, as well as a service connecting Taipei, Sydney and New Zealand. Starlux is to become the first Taiwanese carrier to offer non-stop services to the two European cities, while the inaugural oceanic route is expected to expand transit opportunities within the Australia-New Zealand market, Starlux said. Flight services to Chicago, Dallas, Washington and New York are under evaluation, the airline added. Prior to the shareholders’ meeting, the airline earlier this year announced that it would be
Intel Corp regards Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) as a longstanding partner, as the US chipmaker would continue outsourcing production of advanced chips to TSMC, Intel chief executive officer Lip-Bu Tan (陳立武) said yesterday. “I don’t look at people as competitors. I look at the collaboration... Nvidia is also, you know, a good friend,” Tan told a news conference following his keynote speech at the Computex trade show in Taipei. “It’s a very trusted partnership for us... We are a big, top customer for them, and we’re going to continue doing that,” he said, referring to TSMC, the world’s largest foundry
RSS