MediaTek Inc (聯發科) and MStar Semiconductor Inc (晨星半導體), the nation’s two leading IC designers, yesterday said they had won approval for their planned merger from Chinese antitrust authorities.
In separate filings submitted to the Taiwan Stock Exchange, the two companies said the Chinese Ministry of Commerce had approved their merger application under certain conditions.
Considering that a work program for their merger conditions still needs China’s approval, plus the process of delisting MStar from the Taiwan Stock Exchange, the companies propose to tentatively change the effective date for the merger to Feb. 1 next year from Nov. 1 this year, according to their filings.
Based on the companies’ filings, the Chinese authorities said MStar’s handset and communication-related chips will be integrated with MediaTek, but it wants MStar’s TV business to be kept as an independent entity.
China also wants MStar to maintain its independence and also a competitor to MediaTek for three years, although the latter can enjoy certain shareholder rights such as consolidated reporting, dividends and board election.
Moreover, the two companies will have to obtain approval from China if they want to acquire any TV chip competitor in the future, and they have to file progress reports to the commerce ministry every three months for three years.
“It is now up to MediaTek and MStar to decide whether these conditions are acceptable,” Yuanta Securities Co (元大證券) analyst George Chang (張家麒) said yesterday in a note. “It is common practice in an antitrust case that companies are requested to maintain two different brands in the end market.”
Chang said if MediaTek decides to maintain minimum resources for its TV business and put most of its efforts into handset, tablet and LTE in order to meet China’s merger conditions, the move could still generate synergy and help MediaTek to better compete in the mobile business in the long-run.
MediaTek, the nation’s biggest handset chip designer, and MStar, the world’s largest supplier of flat-screen TV chips, announced in June last year that they planned to merge in a bid to enhance competitiveness in a deal estimated to be worth NT$115 billion (US$3.83 billion). Thus far, the two companies have postponed the actual merger date for a fourth time since January as they await approval from foreign antitrust authorities.
Yesterday’s announcement was made after the closure of local stock market, where MediaTek shares closed unchanged at NT$367.5, while those of MStar rose 0.2 percent to NT$246.5.
Gogoro Inc (睿能創意) yesterday launched its first electric bicycle, the Gogoro Eeyo 1, in Taiwan, after unveiling the bike in New York in late May and in France on Tuesday. The company said it would also introduce the series in other European countries such as Germany and the Netherlands. The “Eeyo project” is the fourth of Gogoro’s eight projects that concentrate on smart transportation, which includes Gogoro’s electric scooter, battery swap system and electric scooter sharing service, company founder and chief executive officer Horace Luke (陸學森) told a media briefing in Taipei. “There are various types of city commuters. We will not
EXPERIMENTAL DRUG: While news about a COVID-19 vaccine is more eye-catching, developing a treatment would be more viable, the Senhwa boss said Senhwa Biosciences Inc (生華科) aims to raise NT$1.5 billion (US$50.57 million) by issuing 15 million new common shares in the third quarter of this year to fund the research of new drugs, including the experimental drug Silmitasertib for the treatment of COVID-19, the company said on Monday. That would be the firm’s largest fundraising effort after it raised more than NT$1.4 billion from an initial public offering on the Taipei Exchange (TPEX) in April 2017, chief financial officer Sarah Chang (張小萍) told the Taipei Times by telephone. The price of the new shares would depend on the firm’s average share price
NOT A PANACEA: Offering 5G services would not solve the problem of declining telecom incomes, chairman Sheih Chi-mau said, expecting a flat 5G telecom revenue Chunghwa Telecom Co (中華電信) yesterday became the nation’s first telecom to debut its 5G services, offering tiered tariffs that include a threshold of NT$599 and flat rates, as it aims to switch half of its subscribers to the 5G network within three years. Subscribers would have unlimited data transmission for monthly fees starting at NT$1,399 — the same flat rate as when the company launched its 4G service in 2014 — and they can subscribe to the highest-rate plan for NT$2,699 per month for faster data transmission speeds and larger bandwidth, the company said. Data transmission speeds would be within the range
ROW: A probe would determine if the rights of shareholders who were not allowed to vote yesterday had been violated, while the stock exchange also wants answers The election of board directors yesterday at Tatung Co (大同) sparked controversy after the company blocked some institutional and individual shareholders from participating in the general shareholders’ meeting, prompting the Financial Supervisory Commission (FSC) to announce that the vote would be investigated. Lin Kuo Wen-yen (林郭文艷) was re-elected as chairwoman of the household-appliance maker’s nine-member board, but prior to the vote she announced that several shareholders would not have voting rights. They were being denied a vote because they had contravened the Business Mergers and Acquisitions Act (企業併購法), and the Act Governing Relations Between the People of the Taiwan Area and