UMC unit and two component makers in share merger

United Microelectronics Group (聯電集團) announced yesterday that the group's printed circuit board unit and chip packaging unit will merge with two local component makers through a share swap.

The increasingly competitive printed circuit board market has made it necessary for companies to pursue mergers in order to survive.

Robert Tsao (曹興誠), head of the group, said yesterday in a press conference that the new company will have a paid-in capital around NT$10 billion and that he will serve as chairman.

The four-way merger involves World Wiser Electronics Inc (欣興電子) and Unicap Electronics Industrial Corp (耀文電子) of the UMC Group as well as Bestmult Industry Co (恆業電子) and UniMicron Electronics Co (群策電子).

The new entity, UniMicron Technology Corp (聯耀電子), has retained the name UniMicron from the chip packaging unit it is absorbing, Tsao explained.

Following the merger, UniMicron Technology aims to expand its business into advanced circuitry for notebook computers, mobile phone handsets and more profitable computer chips and graphic cards.

"The new company will control five PCB plants in Taiwan, one chip scale packaging plant and one enhance ball grid array packaging plant in Taiwan ... and three companies in China," Tsao said.

The four-way merger also plans to help UniMicron promote cost-efficient manufacturing and accelerate its new technology development. Tsao said he expects the company to achieve annual sales of over US$2 billion by 2005, making it among the top three printed circuit board makers in the world.

The World Wiser will absorb the three other units by trading one Unicap share for 0.76 share in World Wiser, one Bestmult share for 0.5 World Wiser share, and one UniMicron share for 0.9 World Wiser share.

The share swap is to take effect on Oct. 31.