The Fair Trade Commission (FTC) yesterday said it was suspending its review of Advanced Semiconductor Engineering Inc’s (ASE, 日月光半導體) bid to take over rival Siliconware Precision Industries Co (SPIL, 矽品精密) because the deal has fallen through.
The commission’s decision meant a victory for SPIL in the high-profile ownership battle, as ASE is now barred from launching a new round of tender offers to fully acquire SPIL within a year as the Company Act (公司法) stipulates.
However, ASE, the world’s largest chip packaging and testing services provider, is not likely to give up so soon.
ASE released a statement saying it will continue with our plan to acquire 100 percent equity interest in SPIL through all legally permissible means and avenues.”
The industrial consolidation will help the company cope with “intense and constant changes in the global semiconductor industry, as well as to ensure the sustained development of the Taiwanese semiconductor packaging and testing supply chain,” it said.
The FTC said in a statement that as “ASE’s tender offer has expired on March 17, there is no chance that the merger will happen. As a result, the commission will stop reviewing the case.”
ASE’s acquisition of a major stake in SPIL has raised anti-trust concerns and fears that the merger would undermine competition in the market.
The FTC on March 16, one day before the March 17 expiry date, said that the deal was complicated, and that before clarifying certain issues related to the potential merger, it could not decide whether it would approve the deal.
The FTC’s announcement essentially meant that the deal could not be completed.
On March 17, ASE said formally that the tender offer could not go through.
The commission’s approval is one of the deciding factors for ASE to clinch the NT$42.35 billion (US$1.3 billion) deal, along with a minimal purchase threshold of 5 percent of 770 million proposed SPIL shares.
The transaction, if approved, would help ASE expand its holding to 49 percent from the current 25 percent and pave the way for a full acquisition.
“We deeply regret and are extremely baffled by the FTC’s decision, which is completely without legal basis and violates the FTC’s own administrative precedents,” ASE said in the statement.
SPIL, which has repeatedly urged the commission to terminate the review of the acquisition deal since March 16, welcomed the FTC’s decision.
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