China Petrochemical Development Corp (CPDC, 中石化) last week voiced concern over the ownership of a joint venture with US-based Praxair Inc, saying that Taiwan’s semiconductor supply chain could suffer if the US company takes complete control of the Hsinchu venture.
“We are worried that the upcoming shareholders’ meeting, which aims to cut the number of Praxair Chemax Semiconductor Materials Co Ltd’s (中普氣體) board directors, would hurt CPDC’s interests,” CPDC chairman Lin Keh-ming (林克銘) told a news conference on Friday in Taipei.
Praxair Chemax, a 49-51 joint venture between CPDC and Praxair, provides industrial gases and gas delivery systems for customers in the semiconductor, LED and solar cell industries.
Praxair, the third-largest industrial gas company worldwide by revenue, plans to hold a shareholders’ meeting for Praxair Chemax tomorrow, local media outlets reported.
“Our substantial control of [Praxair Chemax] might be curtailed if the meeting passes an amendment to the corporate charter,” Lin said, adding that the original charter of the joint venture ensures the balance of power between the two major shareholders.
The current charter allows Praxair to secure four of Praxair Chemax’s seven board seats and one of its two supervisor seats, while CPDC has the right to assign the remaining board members and the chairperson of the venture.
The ownership fight might also have negative implications for Taiwan’s semiconductor supply chain, as local firms could face the challenge of higher industrial gas prices if the US partner obtains the right to decide how prices should be calculated, CPDC said.
Praxair Chemax’s major customers include Taiwan Semiconductor Manufacturing Co (台積電) and Inotera Memories Inc (華亞科技).
Lin — who was elected as Praxair Chemax’s chairman at a board meeting in 2013 — said he had failed to officially register as chairman six times in the past four years, but finally completed registration in November last year.
However, Praxair Chemax’s board was forced to disband last month because the company failed to re-elect its supervisors and directors by Dec. 31 last year as required by the Ministry of Economic Affairs (MOEA), which CPDC attributed to the boycott of the US partner.
At the news conference, CPDC accused the ministry’s central region office of favoritism toward the US company over the past four years.
“It did not take the MOEA very long last month to permit the US company to hold an extraordinary shareholders’ meeting [tomorrow], while the ministry’s procrastination stopped me from exercising power as chairman over the years,” Lin told reporters.
Lin said the ownership dispute should be judged by the courts, not by a shareholder meeting, adding that the ministry needs to stay neutral during the proceedings.
The ministry on Friday dismissed CPDC’s accusation, saying that it did not violate legal procedures and will remain neutral during Praxair Chemax’s ownership dispute.
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