The Ministry of Transportation and Communications is scheduled to auction off a 3 percent stake, worth NT$18 billion (US$566 million), in Chunghwa Telecom Co (中華電信) after the stock market closes on Tuesday, the telecom company said in a filing made to the Taiwan Stock Exchange yesterday.
The 3 percent stake, or about 289.43 million shares, will be sold to domestic investors at a discount of at least 6 percent on its average closing price over the last 10 trading sessions before the auction, the statement said.
Shares of Chunghwa Telecom dropped 3.79 percent to close at NT$63.4 yesterday.
PHOTO: LO PEI-DER, TAIPEI TIMES
Chunghwa Telecom, the nation's largest telecom operator, will take bids before 3:30pm and announce the results after 4pm that day. The auction will take place two days before the company goes ex-dividend on Aug. 11.
The company plans to pay a cash dividend of NT$4.70 per share to those who become Chunghwa Telecom shareholders before Aug. 12, the statement added.
Lu Chia-lin (呂家霖), an analyst with Yuanta Core Pacific Securities (元大京華證券), reacted positively to the news.
"As there is no turning back the privatization of Chunghwa Telecom, I don't think the discount will have a big impact," he said.
However, the timing of the decision came as a surprise, as the company is still struggling to obtain approval from the US Securities and Exchange Commission (SEC) to issue American Depositary Receipts (ADRs).
Lu reminded interested investors that there were still risks regarding the stock, while company chairman Hochen Tan (
As the ministry hopes to sell the state-controlled company's stock to as many buyers as possible, retail investors will be given priority, with each allowed to purchase between 1,000 and 3,000 shares, the company said in the statement.
The remainder will then go to institutional investors, with each restricted to a maximum of 28.943 million shares, the statement said. Foreign investors including overseas Chinese are not permitted to take part in the auction, it added.
The ministry has hired Capital Securities Corp (群益證券) to manage the auction. The securities firm estimates that more than 90,000 retail investors will participate in the auction.
Chunghwa Telecom registered with the SEC on July 7 to sell as many as 1.29 billion shares in the form of ADRs, or about 13 percent of the company's shares. But the company on July 29 applied to increase the size of the offering to as many as 1.64 billion shares, or a 17 percent stake, without giving a reason for the increase.
The completion of the sale of 1.64 billion shares will lower the ministry's stake in Chunghwa Telecom to below 50 percent, from the current 65 percent, putting the telephone operator into private hands.
The Chunghwa Telecom Workers' Union (中華電信工會) has fiercely opposed the privatization plan, however, saying it will hurt employee benefits. Responding to the latest development, the union yesterday said the auction would end up profiting certain investors, instead of the public.
"It's too speculative. Too much political manipulation is involved," union head Simon Chang (
Chang said the ministry had only allowed a few days for interested retail investors to prepare for the auction, which was not enough time to make the policy known.
"We don't oppose privatizing the company, but the method must be legal and provide equal opportunities for the general public," he said.
Chang also urged the government to halt the company's ADR issuance, saying suitable approaches should be hammered out to distribute Chunghwa shares to the whole nation, similar to what Singapore's government has done.
Napoleon Osorio is proud of being the first taxi driver to have accepted payment in bitcoin in the first country in the world to make the cryptocurrency legal tender: El Salvador. He credits Salvadoran President Nayib Bukele’s decision to bank on bitcoin three years ago with changing his life. “Before I was unemployed... And now I have my own business,” said the 39-year-old businessman, who uses an app to charge for rides in bitcoin and now runs his own car rental company. Three years ago the leader of the Central American nation took a huge gamble when he put bitcoin
TECH RACE: The Chinese firm showed off its new Mate XT hours after the latest iPhone launch, but its price tag and limited supply could be drawbacks China’s Huawei Technologies Co (華為) yesterday unveiled the world’s first tri-foldable phone, as it seeks to expand its lead in the world’s biggest smartphone market and steal the spotlight from Apple Inc hours after it debuted a new iPhone. The Chinese tech giant showed off its new Mate XT, which users can fold three ways like an accordion screen door, during a launch ceremony in Shenzhen. The Mate XT comes in red and black and has a 10.2-inch display screen. At 3.6mm thick, it is the world’s slimmest foldable smartphone, Huawei said. The company’s Web site showed that it has garnered more than
PARTNERSHIPS: TSMC said it has been working with multiple memorychip makers for more than two years to provide a full spectrum of solutions to address AI demand Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said it has been collaborating with multiple memorychip makers in high-bandwidth memory (HBM) used in artificial intelligence (AI) applications for more than two years, refuting South Korean media report's about an unprecedented partnership with Samsung Electronics Co. As Samsung is competing with TSMC for a bigger foundry business, any cooperation between the two technology heavyweights would catch the eyes of investors and experts in the semiconductor industry. “We have been working with memory partners, including Micron, Samsung Memory and SK Hynix, on HBM solutions for more than two years, aiming to advance 3D integrated circuit
Vanguard International Semiconductor Corp (世界先進) and Episil Technologies Inc (漢磊) yesterday announced plans to jointly build an 8-inch fab to produce silicon carbide (SiC) chips through an equity acquisition deal. SiC chips offer higher efficiency and lower energy loss than pure silicon chips, and they are able to operate at higher temperatures. They have become crucial to the development of electric vehicles, artificial intelligence data centers, green energy storage and industrial devices. Vanguard, a contract chipmaker focused on making power management chips and driver ICs for displays, is to acquire a 13 percent stake in Episil for NT$2.48 billion (US$77.1 million).
RSS