Taiwan Land Development Corp (TLDC, 台灣土地開發) yesterday asked the government to remove obstacles so that it could sell land to end its cash problems, causing its shares to plunge by the daily limit, with margin trading to be suspended, starting today.
“All the company needs is a cash injection of NT$1 billion [US$35.1 million] for its shares to qualify for credit trading again,” TLDC chairman Chiu Fu-sheng (邱復生) told a news conference in Taipei, protesting the labeling of the company’s stock as full delivery shares.
The Taiwan Stock Exchange ordered the change of trading method for the company’s shares on Thursday last week, after the Taipei-based developer revealed that it had incurred NT$1.83 billion in net losses last year, with accountants saying that “grave uncertainty overshadows the company’s continued operation.”
Photo: Chen Yung-chi, Taipei Times
TLDC shares yesterday tumbled by the 10 percent daily limit to NT$5.87 on the Taiwan Stock Exchange.
Full delivery stocks, which normally have a book value below the exchange’s required minimum of NT$5 per share, suggest financial difficulties and have limited liquidity. Barred from margin trading, investors must pay in advance and in full for these trades.
Chiu apologized for the firm’s poor financial performance, which he attributed mainly to the COVID-19 pandemic and disputes with local governments.
TLDC has a net worth of more than NT$23 per share, or assets valued at NT$29 billion, including 250,000 ping (82.64 hectares) of land across Taiwan that could be turned into floor space totaling 320,000 ping, Chiu said.
Travel restrictions played havoc on the company’s Wind Lion Plaza (風獅城) in Kinmen County, a shopping mall and a joint venture with the county government, while New Paradiso (新天堂樂園), a mixed-use complex with a shopping mall and other recreational facilities in Hualien County, benefited from a boom in domestic tourism, Chiu said.
The Hualien County Government pledged to give TLDC permanent land ownership and other financial compensation, but has yet to make good on its promises, he said.
Over the years, the firm has also accumulated billions of New Taiwan dollars of credit from the government for helping develop science parks in Taichung, Chiu said.
TLDC is in talks with foreign buyers, who are interested in its land in Hualien and Hsinchu, where the developer is converting a hillside into a recreational complex featuring a cultural park, hotel and residential units, he said.
The company could reverse its cash problems by selling land worth NT$1 billion, a modest sum, Chiu said.
Onshoring companies need space to set up production lines and TLDC could help meet their needs if local governments settle their disputes with the company, Chiu said, adding that the company also owns land in Taichung and Nantou County.
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