Toppoly Optoelectronics Corp (
Toppoly was given the green light to issue around 740 million new shares in exchange for Philips' mobile manufacturing unit's US$21 million in assets, the Investment Commission said in a statement.
Philips' mobile display unit, headquartered in Hong Kong, has factories in both Shanghai and Shenzhen, China, as well as Kobe in Japan. It also has a research and development center in Shanghai.
home investment
Toppoly met related rules regarding on local flat-panel makers' investment in China, including the investment cap of 40 percent of a company's net value and pledge of new investment at home, the commission said.
"Toppoly plans to spend NT$10 billion (US$313 million) to expand its capacity in Taiwan from next year to 2009," said spokeswoman Sharon Ning (甯淑芬) in a phone interview with the Taipei Times.
The company, based in Miaoli County, about 100km kilometers south of Taipei, plans to boost monthly production to 90,000 units from 75,000 units at present, Ning said.
Toppoly hopes to wrap up the deal in the first half of the year, Ning said. After the takeover, Toppoly, now ranked 12th, would jump to third place among the world's manufacturers of small and medium-sized displays used in a wide range of devices such as cellular phones.
The takeover would also lift Toppoly's market share to around 10 percent from the current 3 percent, the company said.
client boost
In addition, the deal would bring more heavyweight customers to Toppoly, such as Nokia Oyj, Sony Ericsson and LG Electronics Co, in addition to its current major client, Motorola Inc, Ning said.
The investment approval came after the government last month partially lifted the ban on Tai-wanese flat-panel makers investing in small-sized -- measuring less than 4 inches -- panels using less advanced technologies in China.
"We think the merger between Toppoly and Philips' mobile unit will not negatively affect the nation's industry. Besides, the company has promised to invest more in the homeland," said Huang Chin-tan (
Toppoly saw its net loss widen to NT$4.06 billion for a net loss per share of NT$1.23 last year. This compares with a net loss of NT$3.42 billion or loss per share of NT$1.15 in 2004, according to statistics provided by the Taiwan Stock Exchange.
Its revenues, however, jumped 38 percent to NT$21.98 billion last year from NT$15.94 billion in 2004.
Shares of Toppoly climbed 2.1 percent to NT$11.18 on the emerging stock market yesterday before the government announced the investment approval.
china investments
The Investment Commission also approved yesterday 10 China-bound investment applications by companies such as Gigabyte Technology Co (技嘉科技), Hon Hai Precision Industry Co (鴻海精密) and Lite-On Technology Corp (光寶科技) worth a total of US$181.05 million.
But Huang noted that the commission had not received any new applications from local liquid-crystal-display (LCD) panel makers since the government's recent relaxation on production investment in China.
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