Flat-panel producer Chunghwa Picture Tubes Ltd (CPT, 中華映管) is seeking to purchase the 19 percent of the shares of local peer Giantplus Technology Co (凌巨科技) that it does not already own through a cash-and-stock tender offer, strengthening its presence in the small and medium-sized screen and module businesses.
CPT, a subsidiary of household appliances producer Tatung Co (大同), said in a stock exchange filing yesterday that its board had agreed to acquire up to 84 million common shares of Giantplus on the open market, with each Giantplus share exchanged for 0.72 Tatung common shares and NT$4.03 in cash.
The nation’s third-biggest LCD panel maker will view the tender offer successful if it obtains a minimum 18.1 percent of the shares, CPT spokesperson Eric Chiang (江振琦) said in the filing.
The tender offer begins today and will continue through April 12. It requires the regulatory approvals from both the Financial Supervisory Commission and the Fair Trade Commission, Taoyuan County-based CPT said in the filing.
The share purchase will cost CPT between NT$332.4 million (US$11.2 million) and NT$338.5 million, plus between 57.6 million and 60.48 million Tatung shares.
CPT currently holds 130.87 million shares, or 29.64 percent, in the Miaoli County-based Giantplus, which designs and produces small and medium-sized panels and modules, including super twisted nematic (STN), TFT-LCD and touch panels.
Following the tender offer, CPT would hold a stake of between 47.76 percent and 48.67 percent in the smaller peer, which would help the company become more competitive through better vertical integration and increase its profitability, according to the filing.
In 2010, CPT sold a color-filter plant to Giantplus for NT$1.3 billion, which Giantplus had planned to transform into a touch-panel plant to cope with touch-panel demand.
In 2008, CPT retired a 3.5G LCD panel plant to Giantplus for NT$6.5 billion.
Chunghwa Picture had posted continuous losses since the third quarter of 2010. Analysts have said they expect the company to remain in red last quarter despite a better product mix.
In Taipei trading yesterday, CPT shares closed 1.03 percent lower at NT$0.96 ahead of the share purchase plan, while those of Giantplus rose 1.35 percent to NT$9.02. Tatung’s shares ended down 0.63 percent at NT$7.84.