China Development Financial Holding Co (中華開發金控) yesterday announced plans to acquire between 1.64 billion and 3.27 billion common shares, or between 50.1 percent and 100 percent, of KGI Securities Co (凱基證券) on the open market to enhance its profitability and enhance shareholders’ interests.
Under the deal, each KGI share will be exchanged for 1.2 of China Development Financial’s new common shares and NT$5.5 in cash, China Development Financial said in a filing to the Taiwan Stock Exchange.
The deal is expected to total between NT$27.37 billion and NT$54.63 billion, if it gains approval from shareholders on June 22 and receives the go-ahead from the Financial Supervisory Commission.
China Development Financial, the nation’s worst-performing financial services company in terms of earnings last year, also said yesterday its board approved a proposal to cut the capital of its banking unit by 20.62 percent by canceling 1.6 billion shares.
“The capital reduction aims to boost the return on equity for shareholders and cope with the parent company’s overall capital allocation plan,” China Development Financial said in a filing to the Taiwan Stock Exchange.
After the reduction, China Development Industrial Bank’s (CDIB, 中華開發工銀) capital will decline from the current NT$77.6 billion to NT$61.6 billion.
CDIB’s capital adequacy ratio would stand at 2.17 percent after the reduction, posing no material impact on the bank’s business operations, the filing to the stock exchange said.
Shareholders are scheduled to vote on the capital reduction plan at their annual general meeting on June 22.
The investment banking-centric financial group said in February it posted NT$1.56 million in net profit last year, or earnings per share of NT$0.14, and attributed the poor performance to heavy exposure to technology firms in the solar energy, flat-panel and LED sectors.
Shares of China Development Financial dropped 3.36 percent to NT$8.35 before the capital reduction plan announcement, while the benchmark index fell 1.56 percent.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by