Benq fights off hostile takeover

nightzip SG

Benq fights off hostile takeover

Builds cash pile, Hon Hai in the frame

By INQUIRER staff: Monday 21 August 2006, 06:29

A REPORT said giant Taiwanese firm Benq is building a cash mountain to prevent a hostile takeover.
The Taiwan Economic News said that Benq, which came originally from the Acer stable, is raising a third of a billion dollars to stave off corporate raiders.
The newspaper claims that Benq has denied press reports it will team with Hon Hai (Foxconn). But other press reports claim Hon Hai wants to buy a majority share in Benq so it can control LCD flat panel maker AU Optronics.

AUO is under Benq's wing.

Benq was doing just fine and dandy but bought SIemens' mobile phone unit which it is finding difficult to digest. µ

lpx88 SG

EE…..i fink BenQ should stay on its own…

troublemaker2005 SG

Don't under estimate Foxconn/ Hon Hai. Their humble beginnings as a plastic component manufacturer up to the famous brands in cable assemblies, connectors for PCBA and up to the launch of their motherboards. Believe me they have the capabilities to make electronic components, boards and take up on the precision industries with plastic mold parts and metal stamping parts. I am not suprised if they have intentions to try their hands at the display manufacturing industry.

BTW can provide the link to the related article?

nightzip SG

sorry for the late reply...here you go.

http://www.theinquirer.net/default.aspx?article=33805

http://news.cens.com/php/getnews.php?file=/news/2006/08/21/20060821016.htm&daily=1

nightzip SG

BenQ to Raise NT$25 B. to Prevent Hostile Takeover

Taipei, Aug.21, 2006 (CENS)--A senior executive at BenQ Corp., the largest computer-peripheral supplier and a leading consumer-electronics brand in Taiwan, recently reported that its board of directors has resolved to issue NT$10 billion (US$306.75 million at US$1: NT$32.6) worth of convertible bonds and NT$15 billion (US$460.123 million) worth of preferred shares to prevent a possible hostile takeover.

Despite BenQ stock prices having soared several days straight, Eric Yu, the company's chief financial officer (CFO) and senior vice president, sternly denied reports of BenQ planning to set up a strategic alliance with the Hon Hai Group, the largest private manufacturer in Taiwan and the world's largest maker of connectors, barebone PCs, and game consoles.

Yu pointed out that currently BenQ's top priority is to take its cellphone business into the black as soon as possible.

Some institutional investors pointed out that market rumors has it that Hon Hai is actively trying to acquire a majority stake in BenQ so as to control the operating rights to BenQ's key subsidiaries, such as AU Optronics Corp. (AUO), Taiwan's No. 1 thin film transistor-liquid crystal display (TFT-LCD) panel maker; and Darfon Electronics Corp., a world-leading manufacturer of telecommunication components and precision devices.

A senior BenQ executive said that his company's management team has mapped out a comprehensive plan to prevent hostile takeovers. Currently, the largest investor shareholder holds only a 5% stake in BenQ, he added, and the newly raised funds are expected to increase the company's capitalization by about NT$12.5 billion (US$383.44 million) to further strengthen the mechanism.

BenQ has enjoyed clear sales growths in the past few years but no longer in the wake of its acquisition of Siemens' cellphone business.

BenQ plans to hold a shareholders meeting on August 24 to publicize its second-quarter operating results and third-quarter forecasts. Industry sources said that BenQ's second-quarter core-business loss is expected to increase, with such loss to be between NT$500 million to NT$3 billion (US$15.34 million to US$92 million), due to the sale of its optical-disc drive business to Lite-On IT Corp.; the sale of Darfon shares; and its acquisition of the Siemens cellphone biz.

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