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Philips to offload TSMC shares

Posted: 11 May 2007 ?? ?Print Version ?Bookmark and Share

Keywords:TSMC shares? fab shares? foundry stake?

Royal Philips Electronics is preparing to sell a $2.5-billion stake in foundry Taiwan Semiconductor Manufacturing Co.

The move is part of a strategy to shift away from mature and volatile industries like semiconductors and into units that make medical equipment, lighting and consumer appliances.

The sale is part of a plan released earlier this year in which Philips will eventually sell its entire stake in the foundry. The company holds approximately 3.3 billion TSMC common shares, which amounts to 12.8 percent of TSMC shares. The stake is worth $6.7 billion.

In the current offering, Philips will unload 1.2 billion common shares, which total 240 million American Depository Shares. The electronics giant is also looking to draw down its one-third stake in South Korean flat-panel display maker LG.Philips LCD.

Philips has said it will completely sell out its stake in TSMC by 2010.

TSMC has indicated it will buy up at least some of the shares that Philips, one of the original investors in the foundry, is looking to sell. Analysts estimate that TSMC may spend about $1.5 billion to $2 billion to buy its shares back from the Amsterdam-based company.

- Mike Clendenin
EE Times

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