Foxconn Forays Into Korea With Purchase of SK C&C StakeTim Culpan
Hon Hai Precision Industry Co., the biggest unit of Terry Gou’s Foxconn Technology Group, bought a 4.9 percent stake in SK C&C Co. as it seeks to broaden beyond assembling phones and tablet computers.
Hon Hai paid 381 billion won ($377 million), or 155,500 won apiece, for the stock from SK Holdings Co. Chairman Chey Tae-won, the Taipei-based company said in an exchange filing today.
Gou, who last month led a NT$11.7 billion ($392 million) investment in a Taiwanese phone operator, is expanding into electric cars, cloud computing and automation to reduce Foxconn’s reliance on making Apple Inc. products. Since the release of iPhones and iPads, the Cupertino, California-based company has accounted for almost half its revenue.
The investment will “benefit current operations while also supporting efforts to jointly develop new business opportunities,” Foxconn said in an e-mailed statement today.
Shares of SK C&C rose as much as 5.1 percent after the announcement, reversing an earlier slide, before closing unchanged at 166,500 won in Seoul. Hon Hai added 1.4 percent to NT$100 in Taipei, the highest close in more than four years.
SK C&C, based in Seongnam, South Korea, offers technology services including mobile software and electronic payments. The company has a 31.8 percent stake in SK Holdings, which in turn holds an investment in SK Telecom Co., according to data compiled by Bloomberg.
Hon Hai in May announced it would buy 583 million shares in Taipei-based Asia Pacific Telecom Co. and would work with strategic investors to purchase another 244 million shares after both companies bought spectrum for fourth-generation mobile services last year.