Hon Hai Precision Industry Co’s (鴻海精密) decision to reduce its stake in Fitipower Integrated Technology Inc (天鈺科技) by selling 9.09 million shares yesterday sparked a plunge in the integrated circuit designer’s stock.
Fitipower shares dropped 7.87 percent to NT$216.5 in Taipei trading, the lowest since Dec. 8 last year. They have declined 23.23 percent so far this year amid net selling by domestic proprietary traders and investment trust firms.
Hon Hai shares ended yesterday flat at NT$104.5. They have edged up 0.48 percent since the beginning of this year.
Photo: Vanessa Cho, Taipei Times
The deal has attracted market attention at a time when Hon Hai is extending its reach into the semiconductor business.
The iPhone assembler in August last year purchased a 6-inch wafer fab in the Hsinchu Science Park (新竹科學園區) from memorychip maker Macronix International Co (旺宏電子), and announced in November that it planned to establish a semiconductor design center in New Taipei City’s Baogao Science and Intellectual Park (寶高智慧產業園區).
The Fitipower share sale also came five months after Hon Hai disposed of all its 7.62 million shares in radio frequency chipmaker Microelectronics Technology Inc (台揚科技) to realize capital gains.
In a regulatory filing issued on Tuesday, Hon Hai said it planned to sell a 4.8 percent stake in Fitipower through one of its investment units, Hon Yuan International Investment Co (鴻元國際投資).
Hon Hai said it made the move to realize investment gains and would make public the average sale price per share after the transaction is completed.
The company in December 2011 purchased through a private placement 45 million Fitipower shares at NT$13 each via its four investment units: Hon Yuan International Investment, Pao Shin International Investment Co (寶鑫國際投資), Hyield Venture Capital Co (鴻揚創投) and Hon Chi International Investment Co (鴻棋國際投資).
Despite the share disposal, Hon Hai still maintains a sizeable stake in Fitipower of about 21 percent, while its flat-panel subsidiary, Innolux Corp (群創), also retains a 5.3 percent stake in the IC designer, the companies’ previous regulatory filings showed.
Fitipower’s business focuses on display driver ICs used in ultra-high-definition TVs and gaming notebook computers, as well as power management ICs and touch controllers with display driver integration.
Thanks to robust market demand, the company reported record revenue of NT$22.87 billion (US$826.59 million) for last year, up 110.09 percent from 2020.
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