Shares gain ground
Shares prices closed up 1.66 percent yesterday to hit the highest level this year, led by large-cap electronic stocks after flat-panel monitor maker Innolux Display Corp (群創光電) announced a major acquisition, dealers said.
The TAIEX rose 127.05 points to 7,792.68, the highest closing level so far this year, on turnover of NT$123.26 billion (US$3.83 billion).
The market was lifted by Innolux’s weekend announcement that it would acquire Chi Mei Optoelectronics Corp (奇美電子) in a share swap deal for US$5.38 billion to form Chimei Innolux Corp.
The market opened up 0.47 percent and buying accelerated to boost flat panel makers amid optimism triggered by the acquisition, while interest also spread to select old-economy stocks as they were market laggards, dealers said.
“The combination will no doubt boost the new entity’s international presence. Based on the strong gains, investors are very happy about that,” Mega Securities (兆豐證券) analyst Alex Huang (黃國偉) said.
The Innolux-Chi Mei deal has raised hopes that the sector will enter an era of consolidation, dealers said.
AU Optronics Corp (友達光電) closed up just 0.16 percent at NT$31.70 on concerns it would be threatened by the new entity.
“Despite the strong showing, the room for a takeoff is limited as turnover failed to expand accordingly,” Huang said.
Chunghwa Picture chief resigns
Chunghwa Picture Tubes Ltd (華映) president Kay Chiu (邱創儀) resigned and vice president Lin Sheng-chang (林盛昌) was appointed to be acting president, the Taoyuan and Taipei-based company said in an e-mailed statement yesterday.
No reason was given for the resignation, which was effective yesterday.
Chunghwa Picture Tubes shares added 6.98 percent to NT$3.68 as investors have expected the firm would be the target for acquisition.
MOEA rejects Primus plan
The Investment Commission under the Ministry of Economic Affairs (MOEA) yesterday said it has preliminarily rejected the application submitted by Primus Financial Holdings Ltd (博智金融) last Thursday for approval of its fund-raising plan to complete the transfer of ownership at Nan Shan Life Insurance Co (南山人壽).
The commission said that the plan was rejected on the grounds that Primus Financial has failed to detail its shareholders, a ministry official was quoted as saying yesterday.
The official said that Primus Financial was established last month with an initial capital of NT$500,000 and therefore had to enhance its capital before it could complete the acquisition of Nan Shan for US$2.15 billion.
Also, the commission yesterday required Nan Shan’s former financially troubled owner American International Group Inc to file for an approval before it could release its 97.57 percent stake in Nan Shan to Primus Financial.
NT dollar soars
The New Taiwan dollar rose the most in a week on speculation that closer economic ties with China would prompt overseas investors to add to holdings of the nation’s stocks.
“There’s a trend for funds to flow in,” said Yang Kung-yi (楊恭逸), a currency trader at Shanghai Commercial & Savings Bank (上海商銀) in Taipei. “The currency market is taking cues from stocks.”
The local currency yesterday climbed 0.4 percent to NT$32.198 against the greenback on turnover of US$1.015 billion.
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