Shares of local fabric manufacturer Singtex Industrial Co (興采實業) declined 5.36 percent yesterday after it received notification of lawsuits against it by US-based yarn maker Cocona Inc for allegedly violating agreements and false advertising.
Singtex shares dropped to NT$61.79 yesterday from NT$65.29 on Friday last week.
According to Singtex, Cocona claims the company violated their supplier and non-disclosure agreements by using confidential information about Cocona’s products to study its production process and use it to develop Singtex’s S Cafe yarns during the time Cocona was the yarn supplier for Singtex.
Cocona has also accused Singtex of falsely asserting its S Cafe yarns have the same quality as its products, Singtex said.
Cocona will demand that Singtex pay compensation for its losses, the interest on the losses and legal fees, but it still has not proposed an exact figure, Singtex said.
However, Singtex assistant manager Alice Wang (王淑芬), said Cocona’s claims are one-sided and not well supported.
“We have appointed legal agencies in Taiwan and the US today for the upcoming lawsuits,” Wang told reporters yesterday. “We are considering filing lawsuits against Cocona for making false accusations and demanding compensation.”
Wang said the technology for making S Cafe yarns is different to that of Cocona’s, and Singtex has a patent in the US for S Cafe yarns.
Wang said that she hoped the company’s plan to shift its listing to the to the GRETAI Securities Market (GTSM, 櫃檯買賣中心) in the fourth quarter from the smaller Emerging Stock Market (興櫃市場) would not be delayed because of the lawsuits.
From 2005 to 2011, Singtex purchased coconut charcoal yarns from Cocona to make fabrics, and sales of the end products accounted for about 10 percent of Singtex’s annual revenue, Wang said.
Since 2011, the two companies have not had a business relationship because Singtex’s clients stopped ordering products made of coconut charcoal yarns, Wang said.
According to Singtex, Cocona is a company with a revenue of between US$700,000 and US$800,000 a year.
Currently, sales of S Cafe yarns and fabrics account for 20 percent of Singtex’s revenue, Wang said.
From January through last month, the company’s revenue declined 10.09 percent to NT$725.23 million (US$24.19 million) from the NT$806.67 million seen the previous year, according to a company filing to the Taiwan Stock Exchange.
Wang said the drop was due to the company adjusting its production lines as customers shifted preferences to new products, and Singtex’s revenue would see a year-on-year increase in the second half of the year.
STRONG INTEREST: Analysts have pointed to optimism in TSMC’s growth prospects in the artificial intelligence era as the cause of the rising number of shareholders The number of people holding shares of chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) hit a new high last week despite a decline in its stock price, the Taiwan Depository and Clearing Corp (TDCC, 台灣集保) said. The number of TSMC shareholders rose to 2.46 million as of Friday, up 75,536 from a week earlier, TDCC data showed. The stock price fell 1.34 percent during the same week to close at NT$1,840 (US$57.55). The decline in TSMC’s share price resulted from volatility in global tech stocks, driven by rising international crude oil prices as the war against Iran continues. Dealers said
PRICE HIKES: The war in the Middle East would not significantly disrupt supply in the short term, but semiconductor companies are facing price surges for materials Taiwan’s semiconductor companies are not facing imminent supply disruptions of essential chemicals or raw materials due to the war in the Middle East, but surges in material costs loom large, industry association SEMI Taiwan said yesterday. The association’s comments came amid growing concerns that supplies of helium and other key raw materials used in semiconductor production could become a choke point after Qatar shut down its liquefied natural gas (LNG) production and helium output earlier this month due to the conflict. Qatar is the second-largest LNG supplier in the world and accounts for about 33 percent of global helium output. Helium is
Taiwan’s natural gas supply remains stable through the end of May, despite rising concerns about potential disruptions to Qatari liquefied natural gas (LNG) supplies due to escalating conflicts in the Middle East, the Ministry of Economic Affairs said yesterday. The ministry in a statement said that Taiwan has completed preparations for natural gas supply and shipping schedules through the end of May. It has also made plans to increase natural gas imports from regions outside the Middle East in June to ensure a stable supply, it added. Taiwan sources natural gas from 14 countries and is not solely dependent on the Middle East,
China is clamping down on fertilizer exports to protect its domestic market, industry sources said, putting an additional strain on global markets that were already grappling with shortages caused by the US-Israeli war on Iran. China is among the largest fertilizer exporters — shipping more than US$13 billion of it last year — and it has a history of controlling exports to keep prices low for farmers. Shipments through the war-blocked Strait of Hormuz account for about one-third of the sea-borne supply. This month, Beijing banned exports of nitrogen-potassium fertilizer blends and certain phosphate varieties, sources said. The ban, which has not
RSS