TRADE
Brexit to have limited impact
The Bureau of Foreign Trade yesterday said that Brexit would have a limited effect on Taiwan’s exports, as Britain represents only 1 percent of the nation’s overall trade. Meanwhile, the Financial Supervisory Commission said that Brexit-related exposure faced by Taiwanese financial companies totaled about NT$1.31 trillion (US$41.47 billion), of which insurers have the highest exposure at NT$989.6 billion, 4.87 percent of insurers’ capital. Banks have the second-highest exposure at NT$169.5 billion, 0.38 percent of their assets, of which NT$114.4 billion are investments and NT$55.1 billion are loans, the commission said. Equities and futures brokerages have a combined exposure of NT$17.51 billion, 3.63 percent of the two industries’ net value, it added.
ENERGY
FTC approves CPC purchase
The Fair Trade Commission (FTC) yesterday approved CPC Corp, Taiwan’s (CPC, 台灣中油) NT$2.28 billion bid to acquire Tung Ting Gas Corp (東鼎液化瓦斯). The two companies are to merge upon the deal’s completion, with CPC designated as the surviving entity. Approval was granted as the competitive landscape of the nation’s liquefied natural gas market would not be affected, the commission said, adding that it has classified the deal as a vertical merger between different industry segments.
SHIPPING
Supply glut expected to ease
A supply glut that has tormented the global container shipping industry is expected to diminish this year, Yang Ming Marine Transport Corp (陽明海運) said yesterday. Globally, total cargo shipping capacity growth is expected to reach 3.4 percent this year, down from a previous estimate of 4.8 percent, Yang Ming chairman Bronson Hsieh (謝志堅) said. With demand growth holding steady at 1.6 percent, shippers are anticipating freight rates to recover throughout this year, he said, adding that freight rates for some routes between Asia and Europe have surged by 100 percent, while capacity has grown by only 1.6 percent.
CHIPMAKERS
Nanya sells overseas bonds
DRAM chipmaker Nanya Technology Corp (南亞科技) yesterday said it has raised US$500 million through sales of overseas corporate bonds. The bonds are to mature on Jan. 24, 2022, and were issued as zero-coupon and with a 1.75 percent yield per annum, Nanya said, adding that investors have a one-time option to put the bonds at a yield-to-put of 1.75 percent per annum on Jan. 24, 2020. The bonds can be converted into newly issued common shares of Nanya at an initial conversion price of NT$52.47 per common share, the firm said, adding that the transaction is expected to settle and close on Tuesday next week. The chipmaker plans to use the net proceeds to fund a technology upgrade to a 20-nanometer process, it said.
GARMENTS
Makalot sales fall 5.27%
Makalot Industrial Co (聚陽), a garment manufacturer for global clothing brands, yesterday said in a filing with the Taiwan Stock Exchange that sales for last year would decline 5.27 percent to NT$22.13 billion. Pre-tax profit for last year plunged 29.08 percent to NT$1.91 billion, from NT$2.69 billion in 2015, due to lower product prices and weakening demand from its major global brand customers, Makalot said. Makalot shares yesterday fell 0.82 percent to NT$121 in Taipei trading.
KEEPING UP: The acquisition of a cleanroom in Taiwan would enable Micron to increase production in a market where demand continues to outpace supply, a Micron official said Micron Technology Inc has signed a letter of intent to buy a fabrication site in Taiwan from Powerchip Semiconductor Manufacturing Corp (力積電) for US$1.8 billion to expand its production of memory chips. Micron would take control of the P5 site in Miaoli County’s Tongluo Township (銅鑼) and plans to ramp up DRAM production in phases after the transaction closes in the second quarter, the company said in a statement on Saturday. The acquisition includes an existing 12 inch fab cleanroom of 27,871m2 and would further position Micron to address growing global demand for memory solutions, the company said. Micron expects the transaction to
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