Financially strapped Cosmos Bank (萬泰銀行) said yesterday it had signed a memorandum of understanding (MOU) to sell a controlling interest to the US hedge-fund group, SAC Private Capital Group LLC, for US$650 million in new preferential shares and convertible bonds to improve its financial structure.
Taipei-based Cosmos also inked an MOU with GE Money, which agreed to raise its 10 percent stake by buying more new common shares and corporate bonds for US$250 million, a statement released by Cosmos showed.
Together, SAC and GE Money would hold approximately 80 percent of the fully diluted interest in Cosmos Bank upon completion of the deal, Cosmos said.
The two groups would buy those shares and bonds at NT$2 per share, representing a discount of about 63 percent to Cosmos' closing price of NT$5.47 on the Taiwan Stock Exchange yesterday, the Financial Supervisory Commission (FSC) said at a press briefing.
"We welcome the deal and understand the efforts made by Cosmos to improve its financial situation by issuing new shares," FSC spokeswoman Susan Chang (張秀蓮) said.
Chang said the financial regulator hoped Cosmos would sign definitive agreements with SAC and GE within one month to inject much-needed capital into the bank.
After the deal, SAC would hold more than 50 percent of Cosmos' shareholding, she said.
"This is an important step for the future of the bank. With SAC and GE Money managing Cosmos' future together, I expect Cosmos to build on their strengths and obtain new skills while leveraging its existing consumer base," Cosmos chairman Hsui Sheng-fa (
Cosmos, the nation's largest cash card issuer, has accumulated more than NT$20 billion (US$606.2 million) in losses mostly stemming from credit card loan losses, FSC data showed. Cosmos has NT$13.77 billion in capital.
The proposed injection of fresh funds is expected to be completed in the fourth quarter of this year and is subject to execution of definitive agreements and conditions therein, including approval by the board of directors, shareholders and the commission.
With the promise of capital injection, Cosmos was able to avoid being placed under government receivership. Yesterday was the deadline set by the FSC for Cosmos' recapitalization plan.
Cosmos had been in talks with possible investors during the past few months for recapitalization, with both SAC and GE on its shortlist.
SAC, which operates a US$12 billion hedge fund, has promised to maintain a long-term partnership with Cosmos and may help the bank return to health, Chang said.
SAV will send a team to take over Cosmos, Chang said, adding that members of the team were also responsible for helping Japan's Shinsei Bank Ltd's turnaround.
To make room for new investors, Cosmos chairman Hsui Sheng-fa and vice chairman Hsu Sen-rong (許顯榮) would resign, the commission said.
Cosmos is scheduled to hold a board of directors' meeting next week for a reshuffle.
Cosmos Bank, established in 1992, operates 63 branches across the country.
GE Money has been a strategic investor in Cosmos Bank since June last year. Cosmos has made significant progress in key areas such as strengthening risk management, cash and credit card business units, expanding its wealth management portfolio and improving collections and operational capabilities.
Cairo’s new monorail slices across the city skyline, running above the familiar chaos of blaring horns and aging buses’ exhaust fumes that mark rush hour below. The US$4.5 billion monorail, opened this month, is among Egypt’s most prominent new transport projects, part of a debt-funded infrastructure drive criticized for sapping state finances while bringing limited benefits to most of the country’s 109 million people. “It feels like you’re in a different country,” said Ramy Sayed, a restaurant manager, aboard a driverless Innovia 300 train. “No noise, no traffic, we’re not used to this.” The eastern line runs 56km from the bustling middle-class
Starlux Airlines Co (星宇航空) today unveiled a long-haul network expansion plan at a shareholders’ meeting in Taipei, including direct flights to Barcelona, Spain, and Zurich, Switzerland, as well as a service connecting Taipei, Sydney and New Zealand. Starlux is to become the first Taiwanese carrier to offer non-stop services to the two European cities, while the inaugural oceanic route is expected to expand transit opportunities within the Australia-New Zealand market, Starlux said. Flight services to Chicago, Dallas, Washington and New York are under evaluation, the airline added. Prior to the shareholders’ meeting, the airline earlier this year announced that it would be
Taiwanese prosecutors suspect that three people successfully smuggled at least one shipment of Nvidia Corp artificial intelligence (AI) chips to China after first exporting them to Japan, people familiar with the matter said. The trio was detained last week by the Keelung District Prosecutors’ Office for allegedly falsifying documents related to exports of Super Micro Computer Inc servers containing advanced Nvidia chips, which the US has barred from sale to China without a license from Washington. The move marked Taiwan’s first public crackdown on AI chip diversion after years of pressure from the US to take a more active role in curtailing
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) employee bonuses are likely to grow more than 30 percent this year, in line with the past few years as the company’s profits continue to set new records, an anonymous source cited TSMC chairman C.C. Wei (魏哲家) as saying yesterday. TSMC, the world’s largest contract chipmaker, is committed to taking care of its workers, the source said, citing Wei’s meeting with employees yesterday morning. Wei also expressed gratitude to employees for their contribution to the company’s improving bottom line, the source added. Since 2023, TSMC’s employee bonuses have grown at an annual rate of
RSS