DRAM chipmaker Nanya Technology Corp (南亞科技) yesterday said that its parent company, Formosa Group (台塑集團), did not take part in discussions about former president Charles Kau’s (高啟全) career plans.
There is speculation that Kau is to work for China’s Tsinghua Unigroup Ltd (清華紫光) to help the state-backed chip designer expand into DRAM manufacturing business, as Beijing steps up its efforts to boost its role in the world’s semiconductor industry.
Nanya Technology made the remarks in an attempt to dismiss speculation that Kau might play an important part in the formation of a new DRAM camp that includes Nanya Technology, Tsinghua Unigroup and Micron Technology Inc, given that Kau is to retain his seat in Nanya Technology’s board after leaving the company.
Kau is also to retain his board position at Inotera Memories Inc (華亞科技), a DRAM venture between Nanya Technology and Micron.
In a letter sent to Nanya Technology employees last week, Kau said that he hoped to bring together the memory companies across the Taiwan Strait to fend off growing competition and to reshape the landscape of the global DRAM market.
“Formosa was not involved in any discussions about Kau’s career change,” Nanya Technology president Lee Pei-ing (李培瑛) told a media briefing.
“It is Kau’s personal career plan. We respect his decision. Those are all groundless speculations,” Lee said.
However, Nanya Technology did not rule out the possibility of joining cooperation opportunities initiated by Kau, if those proposals meet local regulations and would boost the interests of the company’s shareholders, Lee said.
Lee also said the company’s high-ranking executives have signed non-compete clauses to protect the company’s patents and intellectual property rights.
The company’s partnerships with Micron would not be affected by Kau’s resignation, Lee said.
Nanya Technology yesterday reported a sequential growth of 10.8 percent in net profit for last quarter, as gains from Inotera offset weakness in core business.
Net profit expanded to NT$4.72 billion (US$144 million) in the quarter ending Sept. 30, compared with NT$4.25 billion a quarter earlier, after booking a non-operating gain of NT$1.77 billion mostly from Inotera, the statement said.
Inotera is 24 percent owned by Nanya Technology.
However, operating income shrank 24.5 percent to NT$2.95 billion last quarter from NT$3.91 billion a quarter earlier.
Revenue dropped 7.3 percent quarter-on-quarter to NT$10.34 billion primarily due to a 11.2 percent sequential decline in average selling price.
Nanya Technology expects average selling prices to fall slightly this quarter due to slower-than-expected PC demand and economic slowdown in certain markets curtailing end demand.
“We are still under pressure to reduce prices as some major [PC] vendors are digesting excessive inventories as PC demand fell short of expectation,” Lee said.
“However, we are seeing seasonal [upward] demand in the fourth quarter, which is likely to help stabilize prices and gross margin,” he said.
Gross margin fell to 37.3 percent in the quarter ending Sept. 30, compared with 42 percent in the previous quarter, according to Nanya Technology’s financial statement.
Shipments are expected to grow by a single-digit percentage this quarter from last quarter, the company said.
Nanya Technology aims to issue 320 million new common shares to strategic partners by the end of this year. It plans to use the proceeds to fund technology migration to advanced 20-nanometer technology.
The company said it would keep its capital spending at NT$5.12 billion unchanged for this year.
Shares of Nanya Technology soared 5.12 percent to NT$40, out-performing the TAIEX, which rallied 1.51 percent in Taipei trading yesterday.
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