Taiwan Mobile Co (
The deal would help Taiwan Mobile tap into broadband and higher-margin cable TV businesses, allowing the company to be the second local telecom company to offer mobile, broadband and TV programs over its networks after industry leader Chunghwa Telecom Co (中華電信).
Taiwan Mobile's board yesterday approved a proposal to boost its holding in Taiwan Fixed Network to between 41 percent and 100 percent of the total 6.45 billion shares at NT$8.3 per share via subsidiaries.
Taiwan Mobile holds about 9.95 percent of Taiwan Fixed Network, which owns a 30 percent stake in Taiwan Mobile.
"We hope the acquisition will bring new growth momentum into Taiwan Mobile by expanding to high-margin media business," chairman Richard Tsai (
Taiwan Mobile projected that the purchase would boost its annual revenues by 19 percent. Last year, the phone company made NT$58.9 billion in revenues.
Moreover, it expected the deal would add 10 percentage points to its margin in earnings before interest, taxes, depreciation and amortization (EBITDA). The EBITDA margin for cable TV is about 56 percent, the phone company calculated.
In addition to its core business, a quarter of Taiwan Fixed Network's total revenues come from fully-owned cable TV unit Pacific Broadband Co (富洋媒體科技).
Pacific Broadband ranks No. 4 in Taiwan's cable TV market with a 10 percent share, or 500,000 subscribers.
The company aims to complete the acquisition during the next 41 days, ending April 11, by buying shares on the open market. Taiwan Mobile planned to pay for the purchase using its own capital and a syndicated bank loan of NT$23.5 billion.
The offer of NT$8.3 per share is a 10.6 percent premium, compared to Taiwan Fixed Network's closing price of NT$7.5 on the Emerging Stock Market (
Taiwan Mobile's shares went down by 0.47 percent to close at NT$31.75 on the Taiwan Stock Exchange.
Taiwan Fixed Network said it had received the offer and was planning to hold a board meeting today at the earliest.
Lu Chia-lin (
"Pacific broadband and Taiwan Fixed Network have very small market shares," Lu said.
Taiwan Fixed Network has 6 percent of the landline phone market.
Lu expected the purchase would have a negative impact on Taiwan Mobile in the short term as the fixed-line operator would struggle to generate operating profits.
CAUTIOUS RECOVERY: While the manufacturing sector returned to growth amid the US-China trade truce, firms remain wary as uncertainty clouds the outlook, the CIER said The local manufacturing sector returned to expansion last month, as the official purchasing managers’ index (PMI) rose 2.1 points to 51.0, driven by a temporary easing in US-China trade tensions, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The PMI gauges the health of the manufacturing industry, with readings above 50 indicating expansion and those below 50 signaling contraction. “Firms are not as pessimistic as they were in April, but they remain far from optimistic,” CIER president Lien Hsien-ming (連賢明) said at a news conference. The full impact of US tariff decisions is unlikely to become clear until later this month
With an approval rating of just two percent, Peruvian President Dina Boluarte might be the world’s most unpopular leader, according to pollsters. Protests greeted her rise to power 29 months ago, and have marked her entire term — joined by assorted scandals, investigations, controversies and a surge in gang violence. The 63-year-old is the target of a dozen probes, including for her alleged failure to declare gifts of luxury jewels and watches, a scandal inevitably dubbed “Rolexgate.” She is also under the microscope for a two-week undeclared absence for nose surgery — which she insists was medical, not cosmetic — and is
GROWING CONCERN: Some senior Trump administration officials opposed the UAE expansion over fears that another TSMC project could jeopardize its US investment Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is evaluating building an advanced production facility in the United Arab Emirates (UAE) and has discussed the possibility with officials in US President Donald Trump’s administration, people familiar with the matter said, in a potentially major bet on the Middle East that would only come to fruition with Washington’s approval. The company has had multiple meetings in the past few months with US Special Envoy to the Middle East Steve Witkoff and officials from MGX, an influential investment vehicle overseen by the UAE president’s brother, the people said. The conversations are a continuation of talks that
CHIP DUTIES: TSMC said it voiced its concerns to Washington about tariffs, telling the US commerce department that it wants ‘fair treatment’ to protect its competitiveness Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reiterated robust business prospects for this year as strong artificial intelligence (AI) chip demand from Nvidia Corp and other customers would absorb the impacts of US tariffs. “The impact of tariffs would be indirect, as the custom tax is the importers’ responsibility, not the exporters,” TSMC chairman and chief executive officer C.C. Wei (魏哲家) said at the chipmaker’s annual shareholders’ meeting in Hsinchu City. TSMC’s business could be affected if people become reluctant to buy electronics due to inflated prices, Wei said. In addition, the chipmaker has voiced its concern to the US Department of Commerce
RSS