Taiwan Business in Brief – September 2017

Delta to Take Stake in IP Security Firm

Leading electronics firm Delta Electronics Inc. on August 8 announced a bid to acquire between 35% and 55% of IP security provider Vivotek Inc. in order to beef up its building automation solutions capabilities. A company spokesperson said Delta offered NT$98 per outstanding common share, an 18% premium over Vivotek’s 60-day average stock price of NT$83.47, which will cost Delta between NT$2.8 billion and NT$4.4 billion (US$92.7 million and US$145.7 million). “This is a friendly takeover. Delta lacks capability in providing IP security solutions, and the purchase in Vivotek will help fill the gap,” said Delta spokesman Jessie Chou. Delta said while it will control the management of the company, it will not delist Vivotek from the Taiwan Stock Exchange and will not initiate layoffs.

Delta, which is rapidly expanding in the realm of building automation, last year acquired two companies in that field in Austria and Canada for US$82 million and US$175.7 million respectively.

Windbond Plans Taiwan Expansion

The world’s third-largest NOR flash memorychip supplier, Winbond Electronics Corp., on September 5 announced its intention to build a NT$335 billion (US$11.14 billion) fab in Kaohsiung to produce memory chips to meet strong customer demand. The Hsinchu-based chipmaker has not invested in new manufacturing capacity in more than a decade as the industry has been in a chronic state of overcapacity. Recent demand spikes, however, have spurred price increases. With its Taichung plant nearing full utilization, “Winbond has applied to the Southern Science Park administration for permission to build a new factory to meet business growth and to satisfy customer demand,” the company said in a statement. The park administration greenlighted the investment proposal, enabling the creation of more than 1,000 jobs in Kaohsiung, Winbond stated.

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