Semiconductor Sector – Positive implication from potential buyout for ASE
Private equity firm Carlyle Group is making a move to acquire Advanced
Semiconductor Engineering Inc. (ASE), a Taiwanese test and assembly house,
for $5.46 billion. If the deal closes, ASE may be freed from cumbersome
Taiwan regulations that limit its investments and technology transfers to
China.
ASE is the world’s largest test and assembly house, with a clientele that
includes ATI Technologies, Qualcomm Inc. and Freescale Semiconductor.
Chairman and chief executive, Jason Chang, has already agreed to sell his
18 percent stake to a consortium led by Carlyle, the companies said Friday.
Carlyle said the deal will increase ASE’s chances of winning more
outsourcing business from other companies it owns, such as Freescale, as
well as other firms. That would increase ASE’s lead over Taiwan rival
Siliconware Precision Industries Ltd., U.S.-based Amkor Technology Inc. and
Singapore’s STATS ChipPAC Ltd.
Analysts are speculating that Carlyle and Chang, who will retain his
leadership position, have already agreed to set up the new entity as a
non-Taiwanese firm and list it on another stock exchange, such as Hong
Kong. By registering ASE as a foreign company, it would not be governed by
Taiwan rules that severely restrict technology investments in China.
