Thu, May 10, 2018 - Page 12 News List

Cheng Uei to relist units under holding company

By Ted Chen  /  Staff reporter

Cheng Uei Precision Industry Co Ltd (正崴精密), an affiliate of Hon Hai Precision Industry Co (鴻海精密), yesterday said it would relist three subsidiaries under a holding company.

The company, also known as Foxlink, said that Power Quotient International Co Ltd (PQI, 勁永), Glory Science Co Ltd (光燿科), also known as Glorytek, and Foxlink Image Technology Co Ltd (FIT, 崴強科技) would form a holding company in the hopes of leveraging their combined business strengths and resources for synergistic gains.

The new holding company would wholly own each of the three subsidiaries, each of which is to initiate a share swap to gain a stake in the new entity, Cheng Uei Precision Industry vice president Lee Tseng-rung (李增榮) told a media briefing at the Taiwan Stock Exchange.

The move would require the approval of regulators, as well as that of the three subsidiaries’ shareholders, who are scheduled to gather at separate annual general meetings on June 17.

Under the arrangement, each PQI common share would be converted into 0.194 shares of the new entity, while the conversion rate for Glorytek and FIT would be 1 and 0.529 respectively, with the share swap anticipated to take place on Oct. 1, Lee said, adding that the three subsidiaries would be delisted.

The new holding company would have paid-in capital of NT$2.49 billion (US$83.2 million), Lee said, adding that the subsidiaries’ operations and payroll would not be affected by the restructuring.

PQI, a maker of storage and memory products, as well as consumer electronics peripherals, last year reported net losses per share of NT$6.35, as it booked a NT$1.98 billion goodwill charge related to its investment in a retail chain that sells accessories for Apple Inc products.

Glorytek, an original design manufacturer of optoelectronics and camera modules for smartphones, last year reported earnings per share of NT$2.55, while FIT, which makes image-related products, including LCD monitors, projectors and printers, posted earnings per share of NT$2.31.

PQI would leverage its strength in distribution channels and would look to expand into other segments, such as the Internet of Things and artificial intelligence, Lee said.

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