TPK Holding Co (宸鴻), a touch sensor supplier for Apple Inc’s iPads, yesterday said it is withdrawing from a consortium that seeks to acquire a 50 percent stake in cash-strapped Japan Display Inc (JDI), citing volatile macroeconomic circumstances and risks in the display industry.
“Judging by the global trade situation, industry dynamics and the company’s current operations, we found the scale of risks [from investing in JDI] has exceeded what we thought,” TPK chief strategic officer Freddie Liu (劉詩亮) told the Taipei Times by telephone.
The company is seeking new investment opportunities, but there is no substantial results yet, Liu said.
The withdrawal came after JDI, an iPhone display supplier, last year reported its third straight year of losses and last month announced large-scale job cuts.
Liu declined to comment on whether JDI’s financial situation was behind TPK’s backtrack.
TPK said it has canceled a US$230 million investment in JDI via a private placement, because “multiple situations have changed,” in a filing with the Taiwan Stock Exchange submitted before the local stock market opened.
TPK said it would scrap a letter of intent it had signed with Suwa Investment Holdings LLC to throw a lifeline of up to ￥80 billion (US$737.1 million) to JDI by acquiring a 49.82 percent stake.
TPK had announced the plan in April.
Taipei-based TPK had expected the deal to help it secure a supply of panels from JDI, boost the company’s role in the industry supply chain, enlarge its customer base and expand its market share in automotive displays.
TPK shares rallied 2.35 percent soon after the stock market opened.
However, they pared those gains and closed down 1.18 percent at NT$50.1.
TPK was the first member to quit the consortium following the expiration of a Friday deadline, when Suwa’s investors were to conclude their internal consultations and report a decision.
Investment firms Cosgrove Global Ltd and Topnotch Corp, owned by Fubon Financial Holding Co’s (富邦金控) Tsai (蔡) family, did not give any notice regarding the results of their internal resolutions, JDI said in a statement posted on its Web site yesterday.
The investment firms originally planned to invest a combined US$130 million in JDI.
China’s Harvest Tech Investment Management Co (嘉實科技) has planned to extend the international consultation period to Thursday next week, JDI said in the statement.
Harvest Tech also plans to extend its internal consultation on a subscription to JDI’s third series of convertible bonds totaling US$20 billion to Thursday next week, the statement said.
JDI said it has received a notification from Oasis Management Co announcing its intent to invest US$150 million in the company.
Oasis would consult with its internal bodies by Thursday next week to make the resolutions required for the investment, JDI said.
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