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Last Trade - 25/09/20

Sector
Technology
Size
Large Cap
Market Cap £6.74bn
Enterprise Value £11.13bn
Revenue £11.76bn
Position in Universe 828th / 6417

Taiwan's ASE determined on merger with SPIL amid China anti-trust review

Wed 28th June, 2017 8:40am
KAOHSIUNG, Taiwan, June 28 (Reuters) - Advanced 
Semiconductor Engineering Inc (ASE)  2311.TW  said on Wednesday 
it was determined to complete its merger with a local rival as 
part of global chip industry consolidation and that it was in 
close communication with Chinese authorities who have extended 
their year-long anti-trust review of the deal.  
    "We continue to have close communication with the Chinese 
government," ASE chief operating officer Tien Wu told reporters 
on the sidelines of a shareholders' meeting. "We hope to 
complete this merger case as soon as possible." 
    Wu said anti-trust regulators in jurisdictions, including 
Taiwan, the United States, the United Kingdom, the European 
Union and South Korea, have already given the nod for the 
merger, first announced in mid-2016, between Taiwan's two 
largest chip test and packaging companies. 
    The deal would put ASE and Siliconware Precision Industries 
Co (SPIL)  2325.TW  under one holding company that would then 
operate the two businesses, which ratings agency Fitch said in 
May would give the combined entity a stronger market position 
though a worse credit profile.  urn:newsml:reuters.com:*:nL3N18N1VJ  urn:newsml:reuters.com:*:nFit1001057 
    Earlier this month, ASE said it had re-filed its merger 
application with China's commerce ministry, which needed more 
time to review the deal, after first receiving the plans in 
August 2016.  urn:newsml:reuters.com:*:nL3N1J330D 
    The deal is set to expire at the end of this year if it is 
not consummated, but Wu said it was "very likely" that both 
companies would agree to an extension, while also dismissing 
possible non-economic factors affecting its review in China.  
    "From a business (view), the economic principles and 
competition consideration of this merger case are very clear," 
he said.   
    The deal capped months of effort by ASE to wrestle control 
of SPIL first by buying SPIL shares in the open market and then 
beating back rival suitors Taiwan's Hon Hai Precision Industry 
Co  2317.TW  and China's state-backed Tsinghua Unigroup. 
    The hold-up in ASE-SPIL's anti-trust review in China comes 
as relations have cooled between Taiwan and China since the 
independence-leaning Democratic Progressive Party took power on 
the island last year. China deems Taiwan as its own, to be 
brought under its control by force if necessary.  
    Taiwan has also protected its prized chip industry from 
becoming too reliant and open to China. Tsinghua Unigroup saw 
its more than $2 billion in deal-making that it had hoped to 
seal on the island unravel at the start of this year when the 
last of three Taiwan companies it wanted to partially acquire 
scrapped the plans, citing regulatory hurdles in Taiwan. 
 urn:newsml:reuters.com:*:nL4N1F33HO 
 
 (Reporting by J.R. Wu; Editing by Muralikumar Anantharaman) 
 ((jr.wu@thomsonreuters.com; +886 2 2500 4881; Reuters 
Messaging: jr.wu.thomsonreuters.com@reuters.net)) 
 
Keywords: ASE SPIL/CHINA
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