United Microelectronics Corp (UMC, 聯電) Chairman Robert Tsao (曹興誠) yesterday criticized his bigger rival, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) Chairman Morris Chang (張忠謀), for the latter's recent change in attitude toward a stock bonus scheme.
In a speech delivered at the 2004 Taiwan Venture Forum yesterday, Tsao said the stock bonus scheme is a proven system that helps the nation's high-tech companies hold onto their employees.
PHOTO: CNA
But there are concerns by investors and regulators that excluding such grants as a cost allows companies to inflate their profits while hurting return on equity. Still, Tsao defended the scheme as the best solution to attain a lower employee turnover rate.
In late October, Chang said that the expenses incurred by stock bonuses do place a burden on earnings and could distort a company's bottom line. He said that TSMC was still seeking a better solution to retain talented employees and safeguard shareholders' interests.
As a result, TSMC said last week that its board was proposing a revised stock dividend policy, calling for future dividend distributions to be made preferably by way of cash.
Stock dividends won't exceed 50 percent of the total distribution, the company said in a statement.
But Tsao yesterday raised doubts about Chang's stewardship. He said that stock bonuses should be granted to rank-and-file employees instead of senior level management, but as far as he knew Chang received the majority of TSMC's dividend distribution.
"TSMC and Morris Chang are the biggest beneficiaries of the stock bonus scheme, and we believe that he should come out to defend the system. But he hasn't," Tsao said.
"After he [Chang] criticized the system ... we thought he might cancel the grants. But in contrast, he worked to issue the dividend, with himself receiving the greatest amount. Therefore, I question his credibility," Tsao said.
The new rules requiring firms to count stock bonuses as part of their costs, are expected to be implemented next year, a Chinese-language business daily reported last month, citing unidentified government officials.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, booked its first-ever profit from its Arizona subsidiary in the first half of this year, four years after operations began, a company financial statement showed. Wholly owned by TSMC, the Arizona unit contributed NT$4.52 billion (US$150.1 million) in net profit, compared with a loss of NT$4.34 billion a year earlier, the statement showed. The company attributed the turnaround to strong market demand and high factory utilization. The Arizona unit counts Apple Inc, Nvidia Corp and Advanced Micro Devices Inc among its major customers. The firm’s first fab in Arizona began high-volume production
VOTE OF CONFIDENCE: The Japanese company is adding Intel to an investment portfolio that includes artificial intelligence linchpins Nvidia Corp and TSMC Softbank Group Corp agreed to buy US$2 billion of Intel Corp stock, a surprise deal to shore up a struggling US name while boosting its own chip ambitions. The Japanese company, which is adding Intel to an investment portfolio that includes artificial intelligence (AI) linchpins Nvidia Corp and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), is to pay US$23 a share — a small discount to Intel’s last close. Shares of the US chipmaker, which would issue new stock to Softbank, surged more than 5 percent in after-hours trading. Softbank’s stock fell as much as 5.4 percent on Tuesday in Tokyo, its
The prices of gasoline and diesel at domestic fuel stations are to rise NT$0.1 and NT$0.4 per liter this week respectively, after international crude oil prices rose last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) announced yesterday. Effective today, gasoline prices at CPC and Formosa stations are to rise to NT$27.3, NT$28.8 and NT$30.8 per liter for 92, 95 and 98-octane unleaded gasoline respectively, the companies said in separate statements. The price of premium diesel is to rise to NT$26.2 per liter at CPC stations and NT$26 at Formosa pumps, they said. The announcements came after international crude oil prices
COLLABORATION: Softbank would supply manufacturing gear to the factory, and a joint venture would make AI data center equipment, Young Liu said Hon Hai Precision Industry Co (鴻海精密) would operate a US factory owned by Softbank Group Corp, setting up what is in the running to be the first manufacturing site in the Japanese company’s US$500 billion Stargate venture with OpenAI and Oracle Corp. Softbank is acquiring Hon Hai’s electric-vehicle plant in Ohio, but the Taiwanese company would continue to run the complex after turning it into an artificial intelligence (AI) server production plant, Hon Hai chairman Young Liu (劉揚偉) said yesterday. Softbank would supply manufacturing gear to the factory, and a joint venture between the two companies would make AI data
RSS