Smartphone maker HTC Corp (宏達電) said yesterday it had reached an agreement with Beats Electronics LLC, selling back nearly half of its stake in the high-end headphone maker for US$150 million.
HTC, the world’s No. 5 smartphone vendor, announced in August last year it would acquire a 51 percent stake in the US company through its subsidiary, HTC America Holding Inc, for about US$309 million.
The Taiwanese firm has since launched several smartphones equipped with headphones that bear the name of superstar music producer Dr Dre in an attempt to appeal to young customers and requisition market share from Apple Inc and Samsung Electronics Co.
REALIGNMENT
HTC said yesterday in an e-mailed statement that it would still be the largest outside shareholder in Beats after the share sale and the two companies would continue to work closely, including a joint global marketing campaign later this year.
Still, the company is expected to book an investment loss of US$4.88 million, based on the headphone company’s current book value, according to the statement.
“HTC and Beats today announced a realignment of their business agreement that provides Beats with more flexibility for global expansion while maintaining HTC’s major stake and commercial exclusivity in mobile,” HTC said in the statement.
“Under the terms of the agreement, the founding members of Beats will buy back 25 percent of its total shares for a total of approximately 75 percent ownership, with HTC remaining the largest outside shareholder with approximately 25 percent,” it said.
LOAN
Meanwhile, the phone maker has also agreed to offer a US$225 million loan to Beats to fulfill the latter’s working capital requirement, according to a separate statement.
The loan offering came after HTC announced on July 3 that Beats had acquired the digital music streaming service MOG Inc for US$14 million as the US company aims to establish a firm foothold in various parts of digital music platform.
The terms of the loan is a three-month LIBOR (London InterBank Offered Rate) plus 1.5 to 7.5 percentage points and the US company will repay the loan by July 20 next year, with collateral including all the assets of the Beats such as accounts receivable, inventory and intellectual property, HTC said.
Shares in HTC closed up 1.01 percent at NT$300 on Friday in Taipei trading. The stock has dropped 39.64 percent so far this year and plunged 76.92 percent from as high as NT$1,300 in April last year due to an increasingly competitive smartphone market amid a dismal global economic outlook.
Cairo’s new monorail slices across the city skyline, running above the familiar chaos of blaring horns and aging buses’ exhaust fumes that mark rush hour below. The US$4.5 billion monorail, opened this month, is among Egypt’s most prominent new transport projects, part of a debt-funded infrastructure drive criticized for sapping state finances while bringing limited benefits to most of the country’s 109 million people. “It feels like you’re in a different country,” said Ramy Sayed, a restaurant manager, aboard a driverless Innovia 300 train. “No noise, no traffic, we’re not used to this.” The eastern line runs 56km from the bustling middle-class
Starlux Airlines Co (星宇航空) today unveiled a long-haul network expansion plan at a shareholders’ meeting in Taipei, including direct flights to Barcelona, Spain, and Zurich, Switzerland, as well as a service connecting Taipei, Sydney and New Zealand. Starlux is to become the first Taiwanese carrier to offer non-stop services to the two European cities, while the inaugural oceanic route is expected to expand transit opportunities within the Australia-New Zealand market, Starlux said. Flight services to Chicago, Dallas, Washington and New York are under evaluation, the airline added. Prior to the shareholders’ meeting, the airline earlier this year announced that it would be
Taiwanese prosecutors suspect that three people successfully smuggled at least one shipment of Nvidia Corp artificial intelligence (AI) chips to China after first exporting them to Japan, people familiar with the matter said. The trio was detained last week by the Keelung District Prosecutors’ Office for allegedly falsifying documents related to exports of Super Micro Computer Inc servers containing advanced Nvidia chips, which the US has barred from sale to China without a license from Washington. The move marked Taiwan’s first public crackdown on AI chip diversion after years of pressure from the US to take a more active role in curtailing
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) employee bonuses are likely to grow more than 30 percent this year, in line with the past few years as the company’s profits continue to set new records, an anonymous source cited TSMC chairman C.C. Wei (魏哲家) as saying yesterday. TSMC, the world’s largest contract chipmaker, is committed to taking care of its workers, the source said, citing Wei’s meeting with employees yesterday morning. Wei also expressed gratitude to employees for their contribution to the company’s improving bottom line, the source added. Since 2023, TSMC’s employee bonuses have grown at an annual rate of
RSS