Wed, Aug 12, 2015 - Page 13 News List

TSMC plans purchase of local OmniVision units

REGULATORY HURDLES:The acquisition would open the door for investors from China to buy the US-based firm, as the assets would not be under Chinese control

By Lisa Wang  /  Staff reporter

Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said its board had approved a plan to spend as much as US$126 million to acquire Taiwan OmniVision Investment Holding Co Ltd and a 49 percent stake in VisEra Holding Cayman Ltd, both local subsidiaries of OmniVision Technologies Inc

The world’s largest contract chipmaker said in a statement that the acquisitions are conditional on regulatory approval from related governments, including the US approving a Chinese consortium’s acquisition of OmniVision Technologies, which is based in Santa Clara, California.

TSMC supplies microprocessors for Apple Inc’s iPhone. The company’s proposed purchase of OmniVision Technologies’ local subsidiaries is to help clear a regulatory hurdle for a group of Chinese investors to acquire the firm, as Chinese firms are not permitted to operate semiconductor businesses in Taiwan.

OmniVision Technologies — which provided the rear camera sensor for Apple’s iPhone 4S — in April agreed to a US$1.9 billion acquisition by a Chinese conglomerate that includes Hua Capital Management Co (華資本管理公司), Citi Capital Holdings Ltd (中信資本) and GoldStone Investment Co (金石投資).

TSMC’s proposed deal would allow the Hsinchu-based chipmaker to increase its stake in VisEra Holding to 98.2 percent. VisEra Holding was established as a joint venture between TSMC and OmniVision Technologies.

TSMC’s board yesterday also gave the go-ahead for capital appropriations of roughly US$1.24 billion to expand capacity for advanced technology and packaging and assembly. The capital expenditures are also to cover certain logic capacity and specialty technology spending this quarter, as well as research and development costs.

TSMC plans to spend between US$10.5 billion and US$11 billion on capital expenditure this year, mostly on advanced technologies.

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