Bringing an end to a high-profile proxy vote battle between Tatung Co’s (大同) founding Lin (林) family and activist investors, the home appliance-maker yesterday elected a new board of directors at its annual general meeting in Taipei.
The management team led by the Lin family — including company chairman Lin Wei-shan (林蔚山) and president Lin Kuo Wen-yen (林郭文艷) — retained their seats on the nine-member board, while a group of investors failed to secure seats.
The election was held after the Financial Supervisory Commission on Friday last week said that a faction of activist investors would not be allowed to exercise their voting rights due to violations of rules governing Chinese investments.
Photo: CNA
SinoPac Securities (Asia) Ltd (永豐金證券亞洲), a Hong Kong-based subsidiary of SinoPac Financial Holdings Co (永豐金控), was accused of funneling more than NT$2 billion (US$66.2 million) from its Chinese clients to purchase Tatung shares, local media reported last week.
Despite the management team’s victory in the proxy fight, its proposal to raise up to NT$600 million through a private placement was rejected by shareholders during the meeting.
The proposal aimed to increase Tatung’s capital from NT$23.4 billion to fund the development of its solar energy business, as part of a long-term plan to turn it into a major profit contributor, the firm said.
Several investors yesterday voiced concerns over the proposed private placement, saying the plan could harm shareholders’ interests further by diluting shares, given the company’s high liquidity.
Tatung in December last year secured a NT$25.2 billion syndicated loan from 16 local banks led by the Bank of Taiwan (臺灣銀行), according to a filing with the Taiwan Stock Exchange.
However, shareholders did sign off on the 99-year-old company’s lackluster performance last year, which saw a net loss of NT$2.3 billion, or a loss of NT$1.03 per share, with sales declining 17.9 percent annually to NT$94.7 billion.
In the first quarter of this year, the firm posted a net profit of NT$93.3 million, compared with a net loss of NT$795.5 million in the same period last year.
Earnings per share were NT$0.04 in the first quarter, significantly improving from a loss of NT$0.35 per share a year earlier, company data showed.
Tatung, which stopped distributing dividends in 2001, still faces an accumulated deficit of nearly NT$2.18 billion as of the end of last year, company data showed.
Tatung shares have fluctuated dramatically since the beginning of this year, peaking at NT$20.56 in Taipei trading in February and closing yesterday at NT$10.55.
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