Asustek Computer Inc (華碩電腦), the world's largest motherboard maker, announced yesterday that it will form a strategic alliance with Advantech Co (研華) through a share-swap, company officials said.
Under the pact, Asustek will hold 15 percent of Advantech's shares and a seat on the board of directors. Advantech, an industrial computing service provider, will own about 1.4 percent of Asustek's shares. Currently, there are five board members at Advantech.
Asustek will issue new shares amounting to over NT$400 million (US$12 million) in exchange for 10 percent of Advantech's shares after the increase in the latter's capital, David Chang (張偉明), Asustek's chief special assistant to the CEO, said yesterday.
Advantech will ask its shareholders to sell some of their holdings to make up the remaining 5 percent. The share-swap will be completed by the end of this year, Chang said, adding that Asustek does not rule out the possibility of closer partnerships with Advantech in the future.
Additionally, the companies said they are planning to establish a new joint venture, which will mark Asustek's first foray into the industrial computing sector.
The new venture has tentatively been named AdvanSus (
According to Dora Chang, Advantech is one of the world's leaders in the industrial-computing industry and has a strong brand name, whereas Asustek's expertise lies in commercial-computing manufacturing, quality control and technology know-how.
By leveraging each other's strengths, the venture will gain a foothold in high-growth industrial-computing areas such as design and manufacturing services, mobile computing, motherboards and servers, she said.
The long-term goal is to enhance both firms' position in the commercial-computing and industrial-computing arenas, she said.
Asustek will issue roughly 60 million new shares in exchange for about 67
million Advantech shares, with each Asustek share being traded for 1.13
Advantech shares, they added.
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