Shares in Uni-President Enter-prises Corp (統一企業), the nation's largest food conglomerate, fell 5.5 percent to NT$26.5 (US$0.82) yesterday following its announcement on Monday that it scrapped a strategic alliance deal with its Chinese rival.
In a statement filed to the Taiwan Stock Exchange yesterday, Uni-President said it withdrew its plan to purchase a 5 percent stake in China Hui Yuan Juice Holdings Co (
Uni-President first announced in March last year that it was planning to buy the Hui Yuan stake for US$30.3 million. Hui Yuan is China's biggest producer of fruit juices.
"The change will not affect our maneuvering and investment plans in China. Any cooperation deal must be able to create win-win effects and be complementary to both sides, otherwise we might have to drop it," company spokeswoman Selina Wu (
On Monday, Hui Yuan, a subsidiary of Beijing Hui Yuan Juice and Beverage Group (
Wu said that over the past few months, Uni-President had engaged in several rounds of negotiations with its Chinese counterpart over the proposal.
Uni-President might have pulled its deal because its total investments in China are approaching the government's 40 percent cap, reports in Chinese-language newspapers said.
According to Uni-President, it has invested more than US$342 million in
China, which is around 37 percent of its net worth.
Asked whether the company was seeking ways to circumvent the ceiling, Wu
said the company would rather follow government regulations.
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