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Philips prepares to sell tranche of TSMC shares

Posted: 12 May 2005 ?? ?Print Version ?Bookmark and Share

Keywords:semiconductor? manufacturing?

Royal Philips Electronics NV reported that Taiwan Semiconductor Mfg Co. Ltd's (TSMC) board on Tuesday (May 10) approved conversion of up to 1.05 billion of its common shares into American depositary shares.

The conversion was undertaken on behalf of Royal Philips Electronics, the Executive Yuan Development Fund and other shareholders.

Philips said it is considering offering a substantial part of 1.05 billion common shares, a sum which represents about a quarter of its holding in TSMC. Philips currently holds approximately 4.4 billion, or 19 percent, of TSMC shares.

Philips was instrumental in the creation of TSMC, and until a few years ago held about a third of the company. Philips shares technology development with TSMC through a joint development agreement in Crolles, France, and the partners also operate a manufacturing joint venture in Singapore known as SSMC.

Philips also uses TSMC as a manufacturing partner, allowing the company to pursue an "asset-light strategy" in its semiconductor division.

"While we'll remain among the largest shareholders in TSMC for the foreseeable future, we believe that in the long-term our shareholders would benefit most from a gradual and orderly reduction in this holding. We don't expect this offering will affect the strategic relation between the two companies," Jan Hommen, vice chairman and CFO of Royal Philips Electronics, said in a statement.

- Peter Clarke

EE Times





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