MStar Semiconductor Inc (晨星半導體) shares surged more than they had in almost seven months on the back of speculation that Chinese antitrust authorities may approve a merger with MediaTek Inc (聯發科技).
MStar jumped 6.7 percent, closing at NT$230 in Taipei, its biggest gain since Aug. 1 last year. MediaTek rose 3.1 percent to NT$336.50, its highest closing at since Dec. 17. The benchmark TAIEX retreated by 0.5 percent.
“There’s speculation in the market that China antitrust authorities may approve the merger soon,” Jih Sun Securities Co (日盛證券) analyst Wenwen Wang said in a phone interview from Taipei yesterday.
“This boosted stocks, as the merger had been delayed for some time because of their [Chinese antitrust authorities] objection,” Wang said.
The two companies, which together design more than 70 percent of chips used in televisions globally, announced the plan in June last year. They need antitrust approvals from China and South Korea because the two countries account for a big portion of their revenue and could threaten local industry, said Vickie Hsieh (謝雯霞), an analyst at President Capital Management Co (統一證券) in Taipei.
An official from MStar’s investor relations office, who declined to be named because she was not authorized to speak to the press, said that there has been no progress on the deal.
China accounts for 60 percent to 70 percent of MediaTek’s revenue, and 50 percent of MStar’s revenue, while South Korea accounts for about 30 percent of MStar’s sales, Hsieh said.