4 Today, Huayaco and Micron announced that they have reached a share conversion agreement. Micron will acquire all outstanding common shares of Huayaco at a price of NT$30 per share of Huayaco, making Huayaco a 100% owned subsidiary of Micron. Huayaco was originally established by Nanya Plastics, a joint venture between Micron and Formosa Plastics Nanya Plastics. Formosa Plastics and Micron each hold approximately 32% of the shares of Huayaco. From Micron's perspective, Micron benefits, while from Nanya's perspective, Huayaco , this time nodding and agreeing to sell out all the shares held by Huayake can be said to be a double gain in technology and money. With the advent of , Nanya was able to invest a large amount of capital. As for Nanya's own 24.6% shareholding, based on Micron's price of NT$30 per share, Nanya made a profit of NT$476 through this transaction. Billion NT dollars, even after deducting the NT$31.5 billion that participated in Micron's private placement, Nanya still has 16.1 billion in capital investment. This 16.1 billion is approximately equal to Nanya's revenue in the first quarter, which will be NT$40 billion in the next 2 to 3 years. For Nanya, which is using the 20nm process, it is undoubtedly an important revenue.
Furthermore, Micron and Huayaco adopted a new pricing model in 2016. Micron ended profit sharing and switched to a profit and loss sharing model. Huayaco officials previously estimated that the gross profit margin will decrease by about 5% annually. In addition, the DRAM market continues to be unstable. This transaction is good for both parties. Micron has gained complete control over Huaya, and Nanya has also reduced its operating risks. In addition, in this transaction, Nanya has also obtained Micron's future 1x/1y process technology authorization and product selection rights. After 20 nanometers, it will also obtain Micron's advanced process authorization below 20 nanometers, which is equivalent to paving the way for future operational development.
Thirdly, Nanya has participated in Micron’s private placement. This move is regarded as a transfer of investment from the original Huayake to Micron, and the amount may also make Nanya become the largest shareholder of Micron. Examining Micron's shareholder structure, most of the shareholders are well-known investment consultants and funds, but the shareholding ratios are quite low. For example, Micron's largest shareholder is Vanguard Group, Inc., a fund management company, which holds approximately 5.68% of the shares, with a shareholding ratio of 5.68%. Second and third, Primecap investment management company * and State Street Corporation only hold about 4% of the shares. According to a report by Morgan Stanley (Mogul), Nanya has an estimated value of NT$31.5 billion. The investment amount (about 9.5 billion U.S. dollars), based on the current market value, will own about 6 to 7% of Micron's equity. Morgan Stanley pointed out that Nanya is expected to become Micron's largest shareholder. However, the final shareholding ratio still has to be determined. It depends on the stock price after the two parties finally complete the transaction.
Regardless of the outcome, Nanya lost Huayake in this transaction, but it also gained more chips.
Micron’s major shareholder structure (Source: Yahoo Finance)
* Primecap Investment Management Company’s full name is Primecap Management Company. The company emphasizes that it is not related to the Vanguard Group’s fund of the same name.
(Source of the first image: Dazhi Image)
Extended reading:
- (Updated) Micron purchased all the shares of Huayaco at a 30% premium
- The United States and Taiwan joined forces to prevent the advance of Ziguang, and Micron "generously" married Huayaco
- Huaya Micron becomes a 100% subsidiary of Micron, which will be beneficial to Micron's future cooperation-related matters
- Micron's acquisition of Huaya Subject? Damo: Mainly to improve the company's finance
[Go to the original page] WeChat search public account technews 2013 (TechNews Technology News) to follow us.
