Innolux Corp (群創) yesterday said chairman and chief executive officer Wang Jyh-chao (王志超) has resigned in a major managerial shake-up that would deepen the panelmaker’s restructuring efforts.
Innolux is an LCD manufacturing arm of Foxconn Technology Group (富士康), known as Hon Hai Precision Industry Co (鴻海精密) in Taiwan.
Personnel adjustments might help accelerate the “integration between panel businesses within the group,” said Wang, who is to serve as a consultant to Innolux.
Wang, who doubles as head of Foxconn’s “K” business group, is overseeing the construction of the group’s G10.5 fab in Guangzhou, China, and its first fab in the US.
Construction of the two fabs is proceeding according to schedule, Wang said.
Wang is later this month to go to Wisconsin to attend the US fab’s groundbreaking ceremony.
“Taiwanese panelmakers have come to the stage where they have to look out [for partnerships] to survive,” Wang said, adding that differentiation is not a panacea amid the rise of Chinese panelmakers.
“As Sharp Corp has incomparable [LCD] technology and Innolux has manufacturing [abilities], it would be a pity if the integration between the two did not happen,” Wang added.
Jim Hung (洪進揚), former president of Taiwan Cement Corp (台灣水泥) and a veteran investment banker, was tapped as Wang’s successor.
Before Hung’s appointment, speculation circulated that he might divide Innolux into several businesses and group some businesses with Foxconn’s panel manufacturing arm in China in preparation for its initial public offering.
“We will not rule out any possibilities,” Hung said, responding to a question about spin-off plans. “A smaller and profitable company would perhaps lift the company’s price-to-earnings ratio and attract more [investor] attention.”
Innolux has been undervalued for a long time, Hung said.
Innolux shares rose 1.72 percent yesterday in Taipei trading to close at NT$11.8, well below the company’s book value of NT$26.5 as of March 31.
Innolux stock was only traded at 4.28 times its earnings over the past 52 weeks, Taiwan Stock Exchange data showed.
To further restructuring efforts, Innolux’s board of directors approved the purchase of a 4.14 percent share of Vizio Inc for US$45 million.
The investment would add one more exit for Innolux’s flat panels, reduce adverse effects from an industry slump and boost its TV assembling business, the company said in a statement.
Last year, the company announced that it would resume assembling TV sets. Innolux expects TV set shipments next quarter to increase to 500,000 units a month for customers Sharp and Vizio.
Innolux shareholders yesterday approved a proposal to distribute a cash dividend of NT$0.8 per common share, representing a payout ratio of 21.5 percent based on the company’s earnings of NT$3.72 per share last year.
Net profits climbed to NT$37.03 billion (US$1.23 billion), or earnings per share of NT$3.72.
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