The buzz about merger talks between local and foreign banks in the wake of Standard Chartered's move to acquire Hsinchu International Bank two weeks ago has diverted public attention from BenQ Corp's failure to turn around its money-losing German handset unit
That's good news for BenQ, given the growing speculation that it might drop its own-branded cellphone business after the company announced plans last month to discontinue investment in its German subsidiary BenQ Mobile and seek bankruptcy protection. Worse, the German public and political opinion have turned against Siemens, as well as BenQ, because of their commitment to retain the jobs of the unit's 3,000 employees in Germany.
So far, the quest to acquire trusted foreign brands to help Taiwanese companies expand their sales and image internationally has not been successful.
Three years ago, consumer electronics brand Sampo Corp made a last-minute exit from a nearly US$100 million deal to buy a controlling stake in the Nuremberg-based Grundig AG, when European banks refused to underwrite a loan of US$430 million for the purchase. Sampo said that without the loan, the ailing Grundig could have depleted its financial resources in just a few months. But Sampo was already having trouble managing skeptical regulators, unions and other stakeholders throughout the acquisition process. That did not bode well for its ability to handle the assets of its German target.
Toppoly Optoelectronics Corp is still trying to integrate the management of Royal Philips Electronics' mobile display unit, which it bought almost a year ago in a bid to become the leader in the world's small and medium-sized display panels.
Whether Toppoly can bridge the geographical and cultural divides between its Dutch unit and its Taiwanese headquarters remains questionable. The company is scheduled to embark on a new round of corporate reorganization by the end of this month.
In an era of international mergers and acquisitions (M&A), strategic considerations are what draws attention of potential buyers looking to expand their regional operations. Standard Chartered was attracted by the Hsinchu bank's underexploited branch network, particularly in the area of wealth management and wholesale banking. Both BenQ and Sampo were tempted by their German counterparts' established brand names and intellectual property. Toppoly was interested in the customer base and manufacturing capacity the Philips subsidiary had on offer.
There is plenty of blame to go around when it comes to failing to achieve a cross-border M&A. In bidding farewell to its German subsidiary, BenQ blamed constant delays in handset research and development and a non-competitive cost structure for the failure of its foray into Western markets. Anyone who believed those claims, however, should really take a minute to consider the real challenge -- integrating the management of the company's local and foreign business units.
For example, disagreements or miscommunication between BenQ's German management and Taipei headquarters over the development process of new products and the speed of reorganization highlight some of the difficulties of integration. BenQ's decision to cut its financial support for the German subsidiary was condemned as rash and irresponsible in Germany, while it was deemed rational to many in Taiwan.
Bridging the gap between Taiwanese companies and their overseas subsidiaries is both time and money consuming, without any guarantee of success. To succeed, companies must select the right acquisition targets, make careful risk calculations and make sure that the integration of management occurs across the board.
Two sets of economic data released last week by the Directorate-General of Budget, Accounting and Statistics (DGBAS) have drawn mixed reactions from the public: One on the nation’s economic performance in the first quarter of the year and the other on Taiwan’s household wealth distribution in 2021. GDP growth for the first quarter was faster than expected, at 6.51 percent year-on-year, an acceleration from the previous quarter’s 4.93 percent and higher than the agency’s February estimate of 5.92 percent. It was also the highest growth since the second quarter of 2021, when the economy expanded 8.07 percent, DGBAS data showed. The growth
In the intricate ballet of geopolitics, names signify more than mere identification: They embody history, culture and sovereignty. The recent decision by China to refer to Arunachal Pradesh as “Tsang Nan” or South Tibet, and to rename Tibet as “Xizang,” is a strategic move that extends beyond cartography into the realm of diplomatic signaling. This op-ed explores the implications of these actions and India’s potential response. Names are potent symbols in international relations, encapsulating the essence of a nation’s stance on territorial disputes. China’s choice to rename regions within Indian territory is not merely a linguistic exercise, but a symbolic assertion
More than seven months into the armed conflict in Gaza, the International Court of Justice ordered Israel to take “immediate and effective measures” to protect Palestinians in Gaza from the risk of genocide following a case brought by South Africa regarding Israel’s breaches of the 1948 Genocide Convention. The international community, including Amnesty International, called for an immediate ceasefire by all parties to prevent further loss of civilian lives and to ensure access to life-saving aid. Several protests have been organized around the world, including at the University of California Los Angeles (UCLA) and many other universities in the US.
In the 2022 book Danger Zone: The Coming Conflict with China, academics Hal Brands and Michael Beckley warned, against conventional wisdom, that it was not a rising China that the US and its allies had to fear, but a declining China. This is because “peaking powers” — nations at the peak of their relative power and staring over the precipice of decline — are particularly dangerous, as they might believe they only have a narrow window of opportunity to grab what they can before decline sets in, they said. The tailwinds that propelled China’s spectacular economic rise over the past