Chunghwa Telecom Co (中華電信), Taiwan's largest phone company, on Wednesday moved one more step closer to the NT$48 billion (US$1.46 billion) overseas share sale planned for later this month after the government raised the ceiling on foreign investment.
The Securities and Futures Bureau on Wednesday approved the Ministry of Transportation and Communications' proposal to lift the cap on overseas investors' stakeholding in Chunghwa Telecom to 49 percent from 40 percent.
The relaxation would give room for foreign investors to buy more Chungwha Telecom shares, as their holding is already close to the previous limit.
The company's foreign ownership was at about 39 percent on Tuesday, while the government owns about 41 percent after it sold a 17-percent stake on both the home and overseas markets in August last year.
Chunghwa Telecom, however, still has one more obstacle to overcome before pushing forward with the sale of 800 million shares mostly in the US on behalf of its biggest shareholder, the ministry and another major shareholder, Taiwan Mobile Co (
The company needs to finalize the selection of underwriters for the overseas share sale after the Ministry of Finance weighed in to ensure the telecom company complied with rules on share sales of state-controlled companies.
Chunghwa Telecom announced last week that it had successfully selected investment banks including Morgan Stanley and USB as its underwriters. Underwriters are firms who help manage share sales.
"If we have to reselect underwriters for the share sale, it could push back the sale. We are working hard now [in hope of selling the shares on schedule]," Chungwha Telecom spokesman and chief financial officer Hank Wang (王漢朝) said in a phone interview with the Taipei Times yesterday.
Foreign investors yesterday bought another 1.12 million Chungwa Telecom shares.
To sweeten the share offering, Chunghwa Telecom cut its capital by 2.03 percent to NT$94.56 billion from NT$96.48 billion recently, according to a company filing it made to the Taiwan Stock Exchange Corp on Wednesday.
The company's net value thereby improved to NT$39.65 per share from NT$38.86 per share, the statement said.