Wed, Jan 19, 2011 - Page 12 News List

Tatung shares dip amid bleak future prospects for firm

By Jason Tan  /  Staff reporter

Shares in Tatung Co (大同), a Taiwanese household appliances manufacturer with a history of more than 90 years, plunged by the daily limit yesterday for the second day in a row, as investors expressed skepticism about the company’s future, despite securing regulatory approval to reduce capital.

The firm’s shares closed down 7 percent at NT$6.7 on the Taiwan Stock Exchange yesterday, after dipping 7 percent on Monday — the same day the Securities and Futures Bureau at the Financial Supervisory Commission (FSC) approved Tatung’s plans to reduce capital by NT$32 billion and sell US$200 million of overseas convertible bonds.

NOT LISTED

Fubon Securities Co (富邦投顧), Polaris Securities Co (寶來證券), Taishin Securities Investment Advisory Co (台証投顧) and -Yuanta Investment Consulting (元大投顧) yesterday said Tatung stock is not in their watch list.

A Yuanta analyst said Tatung has been off its watch list for a long time due to the low attractiveness of its stock.

The Taipei-based conglomerate intended to cut capital by 58 percent by canceling 3.21 billion in existing common shares to cover losses accumulated in recent years.

LOSSES

Tatung saw a loss of NT$1.6 billion (US$55 million) for the first three quarters of last year, or a loss per share of NT$0.29. That compares to a loss of NT$5.5 billion, or NT$1 loss per share, in the same period of 2009.

The FSC rejected Tatung’s capital reduction plan in August, citing the company’s failure to clearly account for its real estate assets and an ongoing property dispute with affiliated Tatung University.

Tatung resubmitted the application last month.

CAPITAL REDUCTION

Established in 1918, Tatung’s subsidiaries include Chunghwa Picture Tubes Ltd (中華映管), Forward Electronics Co (福華電子), San Chih Semiconductor Co (尚志半導體), Green Energy Technology Inc (綠能科技), Tatung Fine Chemicals Co (尚志精密化學), Elitegroup Computer Systems Co (精英電腦) and Tatung System Technologies Inc (大同世界科技).

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