Shares of Advanced Semiconductor Engineering Inc (ASE, 日月光半導體), the world’s largest integrated circuit packaging and testing services provider, yesterday rose ahead of the April 30 listing of a new company formed after a merger, dealers said.
The buying reflected investors’ optimism that the new company, formed through a merger between ASE and Siliconware Precision Industries Co (SPIL, 矽品精密) and called ASE Industrial Holding Co (日月光投資控股), would cement its lead over its peers in the global market, the dealers said.
ASE shares rose 2.59 percent to close at NT$45.50, while SPIL shares closed up 0.20 percent at NT$51.
ASE shares outperformed the broader market, where the weighted index closed down 0.1 percent in reflection of the weakness on Wall Street on Friday last week.
The holding company is scheduled to list its shares on the local main board and the NASDAQ in the US on April 30.
Today is the final day of trading for ASE and SPIL shares in Taipei and the US before they are delisted.
The delistings and the listing of the new company were scheduled after the Chinese Ministry of Commerce cleared an anti-trust review on Nov. 24 last year.
The approval came after the Fair Trade Commission and the US Federal Trade Commission granted their approval for the merger on Nov. 16, 2016, and on May 15 last year respectively.
In May 2016, ASE and SPIL announced that they were planning to form a holding company that would own 100 percent stakes in the two companies, and that the two would remain independent although their separate operations would continue under the roof of the holding company.
Under the deal, ASE shareholders are to receive 0.5 shares of the new company for every common share held, while SPIL shareholders are to receive NT$51.2 cash per share from ASE.
ASE and SPIL in February held special shareholders’ meetings to vote on the merger proposal.
A US brokerage said in a research note that it is optimistic the merger would create synergies for the new firm and forecast that its earnings per share would reach NT$6.33 this year, higher than the combined earnings per share of ASE and SPIL last year.
ASE’s and SPIL’s earnings per share last year were NT$2.82 and NT$2.21 respectively.
It is possible for ASE shares to challenge the NT$50 mark before the stock’s delisting, the brokerage said.
A European brokerage said the new company is expected to take advantage of larger economies of scale in production and a decline in production costs to boost its competitiveness in the global semiconductor market, which is forecast to grow by between 8 and 10 percent over the next few years.
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