Siliconware Precision Industries Co (SPIL, 矽品精密), the nation’s second-largest chip packager and tester, yesterday said it booked an investment gain of US$21.29 million from the sale of ChipMOS Technologies (Bermuda) Ltd (南茂科技) shares.
Analysts said the one-off gain could boost Siliconware’s earnings for the year after the company in July offered a lackluster outlook for this quarter due to inventory adjustments in the non-Apple Inc smartphone food chain.
In a filing to the Taiwan Stock Exchange, Siliconware said it sold 1 million shares of ChipMOS for US$22.39 million. After the latest share sale, the company still holds 1.24 million shares of ChipMOS, or a stake of 4.2 percent.
The investment gain translates into earnings per share of NT$0.2, based on its current outstanding capital of NT$31.16 billion.
On Aug. 19, the company announced that it had acquired a building and clean-room facility in Greater Taichung from ProMOS Technologies Inc (茂德科技) for NT$6.4 billion. The move is indicative of Siliconware’s plans to expand its capacity in advanced packaging, such as flip-chip packaging.
The company has raised its planned capital expenditure for a second time this year to a record-high of NT$18 billion to cope with ballooning customer demand. Spending over the past four years ranged between NT$10 billion and NT$15 billion.
While the company appears optimistic about the opportunities in the advanced packaging market, recent reports that STATS ChipPAC Ltd of Singapore — the world’s fourth-largest chip packager — is looking for buyers could pose a threat to Siliconware’s business outlook.
Siliconware is the world’s third-largest chip packager and tester after Advanced Semiconductor Engineering Inc (ASE, 日月光半導體) and Amkor Technology Inc.
Earlier this week, Jiangsu Changjiang Electronics Technology Co (江蘇長電科技) said its discussions to acquire STATS ChipPAC was still in the preliminary stage, and it might not reach any definitive agreement within the next three months.
Tianshui Huatian Technology Co (天水華天科技), another potential bidder, said it had given up its plan because of adverse market conditions, Singapore’s Business Times reported on Monday.
JPMorgan Securities said in a client note on Aug. 27 that if Jiangsu Changjiang were to buy STATS ChipPAC, this would create a new competitor of the same size as Siliconware and could disrupt the pricing discipline in the advanced packaging market.
“SPIL, with 15 percent exposure to China fabless [sector], is much more susceptible to this threat,” JPMorgan analysts led by Gokul Hariharan said in the note.
However, Yuanta Securities Co (元大證券) said the impact would be limited.
“We believe competition will remain ongoing, while the potential M&A [merger and acquisition] could face cultural challenges during the restructuring period. In sum, we hold a neutral view on the event should it materialize,” Yuanta analyst Andrew Chen (陳治宇) said in a client note on Monday.
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