Taiwan-based printed circuit board (China PCB) maker HannStar Board yesterday declined to comment on a report that it plans to spin off its China unit to raise US$90 million in an initial public offering (IPO) in Hong Kong.
The South China Morning Post (SCMP) cited market sources as revealing that the Taiwan-based company's China unit, HannStar Board International Holdings - the world's largest PCB supplier for notebooks - plans to list in Hong Kong by the end of 2006.
In response, the parent company said it would not comment on the report, citing a "sensitive" time.
In May 2006, HannStar Board announced it would put Hannstar Board Tech (Jiang Yin) - its major investment in China(PCB) - under the control of the holdings firm, which would then be listed overseas. The company said the plan was aimed at future expansion in China.
The Hong Kong-based SCMP cited sources as indicating that after rapid expansion, HannStar Board has almost reached the China PCB investment limit - 40% of its total assets - set by the Taiwanese government, and it is time to spin off the China unit.
In October 2005, the investment restrictions also prompted Taiwan-listed Vertex Precision to spin off its China PCB unit, Global Flex Holdings, to list in Hong Kong, the paper pointed out.
HannStar Board is a member of the Walsin Lihwa group. The company currently operates three plants for China PCB in Jiang Yin, China. Last year, the plants generated NT$705 million (US$21.6 million) in profits, accounting for 93% of HannStar Board's total profits, according to industry sources.
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