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Ministry of finance says TTV chairman should step down

"Lai crossed the line between public and private roles. His share purchase could affect ... bidding prices."

Liu Teng-cheng, deputy finance minister

The Ministry of Finance yesterday said that Lai Kuo-chou (賴國洲), chairman and president of Taiwan Television Enterprise Ltd (TTV, 台視), should be replaced as a result of his "inappropriate" involvement in the run-up to the TV station's public share sale.

The ministry submitted its position to the Government Information Office (GIO), which manages the government-owned terrestrial TV station, after the state-run Land Bank of Taiwan (土地銀行) completed its evaluation report on Lai, Deputy Minister of Finance Liu Teng-cheng (劉燈城) said.

Lai, son-in-law of former president Lee Teng-hui (李登輝), is Land Bank's legal representative at TTV, which is 47 percent controlled by six state-run banks.

As the firm's chairman who represents public shareholders, Lai has applied to the National Communications Commission to purchase 4.8 percent of the shares owned by three Japanese corporate shareholders, raising fears that his move could affect the fairness of the upcoming auction of public shares, Liu said.

Rumors were circulating that Lai could have purchased more than 10 percent of the company's holdings.

"Lai crossed the line between public and private roles. His share purchase could affect potential investors' bidding willingness and bidding prices," Liu said.

Whether Lai is replaced and who might take his position will be decided by the GIO, he said.

Liu said that Lai had proclaimed his innocence on the telephone earlier yesterday, saying newspaper reports had exaggerated his shareholding.

Lai also said that he will not cooperate with any firm interested in the bidding and he would not submit tenders, Liu said.

Local Chinese-language reports said that ERA TV (年代電視), Unique Satellite TV (非凡電視), the Liberty Times (the sister newspaper of the Taipei Times), Dafeng TV Ltd (大豐電視) and Want Want Group (旺旺集團) were among the challengers.

The government has set up a two-stage plan to offload its shares in TTV. In the first stage, the government plans to sell 25.7 percent, via public auctions, of shareholding owned by First Commercial Bank (第一銀行), Hua Nan Commercial Bank (華南銀行), Chang Hwa Commercial Bank (彰化銀行) and Taiwan Cooperative Bank (合作金庫銀行).

In the second stage, it will release the remaining state-owned shares of 21.6 percent controlled by the Bank of Taiwan (台灣銀行) and Land Bank to the public.
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