China's Tsinghua Unigroup taking $600 mln stake in Taiwan chip firm Powertech

Powertech Technology

30/10/2015 10:16

TAIPEI/HONG KONG, Oct 30 (Reuters) - Chinese state-backed 
technology conglomerate Tsinghua Unigroup Ltd is buying a 25 
percent stake in Powertech Technology Inc  6239.TW  for $600 
million, becoming the largest shareholder in the Taiwanese chip 
packaging and testing company. 
    The alliance, announced on Friday by both companies, is 
likely to help bolster the development of China's fledgling chip 
industry and comes after the Chinese tech group recently hired a 
veteran Taiwanese semiconductor executive.   
    "We believe Powertech, with its ability in the assembly and 
testing industry, will be an important member in the 
semiconductor industry supply chain of Taiwan and China. We 
expect to achieve a win-win together following our cooperation," 
said Tsinghua Unigroup chairman Zhao Weiguo, in a company 
statement.     
    Powertech said that the move will help expand its global 
market share, including in China, as a chip assembly and tester, 
and allow it to vertically integrate with the semiconductor 
businesses of Tsinghua Unigroup.   
    Tsinghua Unigroup will pay T$75 ($2.31) a share in a private 
placement of new Powertech shares to gain a 25 percent ownership 
of the company. The deal still needs to be approved by Powertech 
shareholders and relevant regulatory authorities.  
    Powertech's main operations are in Taiwan and it employs 
more than 11,000 on the island, which is around 90 percent of 
the company's total staffing, Powertech said.  
    It said it plans to use the funds from the private placement 
to expand its capacity of advanced assembly and testing services 
in Taiwan and develop advanced processes for production, as well 
as recruit staff.  
    Earlier this month, Tsinghua Unigroup hired Charles Kau, the 
chief of Micron Technology Inc's  MU.O  Taiwanese joint venture, 
as its global executive vice president, a person familiar with 
the matter told Reuters.  urn:newsml:reuters.com:*:nL3N12D3Q9 
    Kau's hiring came about three months after Tsinghua made an 
informal $23 billion takeover offer for Micron that was rejected 
out-of-hand by the Idaho-based company's leadership, although 
the Chinese side has not given up on a deal, sources have said. 
 urn:newsml:reuters.com:*:nL4N1131XG 
($1 = 32.4620 Taiwan dollars) 
 
 (Reporting by J.R. Wu and Yimou Lee; Editing by Muralikumar 
Anantharaman) 
 ((jr.wu@thomsonreuters.com; +886 2 2500 4881; Reuters 
Messaging: jr.wu.thomsonreuters.com@reuters.net)) 
 
Keywords: TSINGHUA UNIGROUP POWERTECH TECH/