Sat, Sep 15, 2007 - Page 12 News List

Shin Kong Financial's move to purchase stake in MasterLink runs into difficulty

By Jessie Ho  /  STAFF REPORTER

The fate of Shin Kong Financial Holding Co's (新光金控) bid to incorporate MasterLink Securities Corp (元富證券) into its wing remained uncertain yesterday with the passing of its deadline for share acquisition and reports of dissatisfaction among Masterlink employees with the financial group's approach.

Shin Kong Financial, the nation's eighth-biggest financial group by assets, announced last July that it would buy a 25 percent stake in MasterLink within a year to consolidate its securities business.

Of the 25 percent stake, 16 percent will be owned by Shin Kong Financial and 9 percent will go to its subsidiary, Shin Kong Securities Co (新壽證券).

Shin Kong Securities had completed the 9 percent share purchase, while Shin Kong Financial had acquired 14.72 percent of Masterlink's shares as of Monday, company data showed.

Yesterday was the deadline set by the Financial Supervisory Commission (FSC) for the share purchase; Shin Kong Financial will have to sell off whatever shares it owns in the brokerage house if it fails to attain the 16 percent target.

Shin Kong Financial refused to reveal whether it had completed the 16-percent share purchase.

"We have decided to talk about this issue when we report to the board ... We don't want to upset MasterLink employees at this time," Shin Kong Financial spokesman Victor Hsu (許澎) said by telephone yesterday evening.

Jong Huey-jen (鍾慧貞), deputy director-general of the commission's Banking Bureau, said she did not know whether Shin Kong Financial had achieved its shareholding target and declined to comment on what action the bureau or the commission might take if the company failed to do so.

"If Shin Kong did attain the target, it should report to the Financial Supervisory Commission right away today," Jong said in a telephone interview. She refused to elaborate.

Meanwhile, a Chinese-language newspaper reported yesterday that Masterlink staff and shareholders were unhappy with Shin Kong Financial's talks of incorporating the company.

The Economic Daily News quoted Chen Chun-hung (陳俊宏), described as a representative of Masterlink, as saying that the securities firms' employees viewed the move as a hostile takeover.

Hsu refused to comment on the report, but said: "We have stressed several times that we deem the MasterLink purchase as a strategic alliance, and any merger or acquisition will be carried out with the consensus of both parties."

Ada Hsu (許恬忻), public relations manager of MasterLink, said that while company employees were uneasy about the merger reports, they did not show any opposition to Shin Kong Financial's share purchase.

Hsu said that Chen is a representative of a board supervisor and not an employee of MasterLink.

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