JPMorgan Chase & Co may have lost a client’s business and face a lawsuit after Wintek Corp (勝華) objected to an analyst’s report that said investors should sell the company’s shares as it was poised to lose market share.
Wintek will “end global depositary receipt [GDR] cooperation with JPMorgan” because of a research report by Taipei-based analyst Narci Chang issued on Tuesday, the company said in a filing to the Taiwan Stock Exchange on Wednesday.
The company, which makes components for Apple Inc’s iPad and iPhone, may take legal action against Chang, the statement said.
The stock fell 5.3 percent to close at NT$46.8 yesterday in Taipei and has slid 12 percent since Monday, after Chang’s report said it is “an ideal time to take a profit on the shares.”
Display makers AU Optronics Corp (友達光電) and Chimei Innolux Corp (奇美電子) are a “serious threat” to Wintek because they are eroding the number of orders it receives from Apple, Chang said.
“The analyst’s report said new players will grab market share, but this assumption was not backed up with any evidence,” Jay Huang (黃忠傑), a spokesman for Taichung-based Wintek, said in a telephone interview on Wednesday. “Without this event, I think we still would have cooperated with them to conduct the GDR offering.”
Wintek’s board on Wednesday last week approved plans to sell as much as US$387 million in GDRs, the company said in an exchange filing that day. No book-runner has been appointed, Huang said.
JPMorgan was the sole book-runner and global coordinator for the company’s GDR sale in April, according to the prospectus.
Marie Cheung, a Hong Kong-based spokeswoman for JPMorgan, declined to comment.
Chang’s “underweight” recommendation on the stock makes JPMorgan the only one of 16 brokerages surveyed by Bloomberg to have a “sell” equivalent rating on Wintek shares. Twelve analysts recommend “buy,” three say “hold” and one has suspended coverage.
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