Siliconware Precision Says $1.7 Billion Tsinghua Deal Is on Hold

  • SPIL wants to partner with Chinese company focused on chips
  • Company also canceled capital increase after investor feeback

Siliconware Precision Industries Co. said a deal to sell a NT$56.8 billion ($1.7 billion) stake to China’s Tsinghua Unigroup Ltd. is on hold after the proposed transaction attracted regulatory scrutiny in Taiwan.

The future of the deal depends on dialog with officials from Taiwan’s new government as well as shareholder, and hostile suitor, Advanced Semiconductor Engineering Inc., Siliconware Chairman Bough Lin said in an interview Monday.

Siliconware agreed in December to sell a stake to Tsinghua Unigroup, its second attempt at finding a white knight after an earlier agreement with Foxconn Technology Group was rejected by investors. ASE, the world’s biggest assembler of microchips, has been buying SPIL shares in the open market since August.

SPIL wants to form an alliance with a private Chinese company focused on semiconductors and doesn’t want to miss out on the marketing opportunity, Lin said at the company’s headquarters in the northern Taiwan city of Hsinchu. China devours nearly half of the world’s microchips and has made no secret of trying to cut its reliance on the supply from overseas.

Lin said the company has also scrapped plans announced just last week to boost its authorized share capital to 3.96 billion shares from 3.6 billion shares. That decision follows feedback from shareholders concerned about dilution of existing investors.

ASE initially offering NT$45 a share for SPIL stock before boosting that to NT$55 a share. SPIL shares closed Monday at NT$50.50.

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