Tsann Kuen shrugs off sentencing of founder

Tsann Kuen Group (燦坤實業), the nation's largest home appliance and consumer electronics chain, said yesterday that the sentencing of its founder would not disrupt operations.

"Wu Tsann-kuen (吳燦坤) no longer holds any position in the company, including the chairmanship or as board supervisor," public relations manager Miki Lai (賴季君) said by telephone.

"The verdict will not on impact our business," she said.

The court case concerned personal behavior, and the company was not in position to comment, she said.

The Taipei District Court sentenced the Tsann Kuen founder and former chairman to three-and-a-half years in jail on charges of fraud and violations of the Securities and Exchange Law (證交法).

Prosecutors began investigating Tsann Kuen in December 2004 for selling its US over-the-counter stocks, registered under the name Eupa International Inc (燦坤美國), to Taiwanese investors in late 2001.

Tsann Kuen claimed that Eupa would eventually trade on the NASDAQ, a claim that allegedly helped raise around NT$100 million (US$3 million) for the company.

The upgrade never happened and more than 35 investors accused Tsann Kuen of cheating after Eupa's share price dropped from between US$8 and US$10 to US$0.1.

Tsann Kuen saw sales last month increase by 3.8 percent to NT$2.3 billion, while cumulative sales for the first six months of the year rose 8.5 percent to NT$15.6 billion.

Tsann Kuen said it would stick to the financial forecast for the year it made in February of hitting net income of NT$1.6 billion, or NT$5.16 per share, with sales totaling NT$30.9 billion.

Tsann Kuen posted NT$29.6 billion in revenues last year, down from NT$30 billion in 2005.

Its shares closed down 1.2 percent to NT$42.5 on the Taiwan Stock Exchange yesterday.