Leading iPhone manufacturer Foxconn has failed to secure a stake in a Taiwanese chip company with the potential to earn massive amounts of cash from Apple.
Foxconn had made a bid for a share in Siliconware Precision Industries (SPIL), offering a share swap which would have made it the largest shareholder in the company.
Unfortunately for Foxconn, the proposal was shot down by SPIL’s board of directors on Thursday, who argued that Foxconn, “fails to make a compelling case regarding necessity of the share swap.”
SPIL isn’t currently on Apple’s supplier list, but Foxconn wanted to work with the company to create system-in-package (SiP) chips designed for Apple. The share swap proposal would have required two-thirds of the votes among SPIL’s board, but it managed only slightly less than half.
In a breakdown of voting figures, 46.6 percent supported the proposition, while 32 percent rejected it and 21 percent abstained. Had it gone through, Foxconn would have owned 21.2 percent of the company through the issuance of new shares. SPIL would meanwhile have received a 2.2 percent of Foxconn’s Hon Hai unit.
As we revealed yesterday, there’s more to this story than meets the eye. Foxconn rival company Advanced Semiconductor Engineering, which also wants to get in on Apple’s business, sent a letter to SPIL’s shareholders ahead of Thursday’s meeting — asking for them to vote against the share swap.
Foxconn will reportedly go back to the drawing board to find another way to get in on the SiP action with SPIL for future Apple manufacturing.
Do none of these competing companies think about sending Tim Cook a nice muffin basket?
Source: Bloomberg
Luke Dormehl is a U.K.-based journalist and author, with a background working in documentary film for Channel 4 and the BBC. He is the author of The Apple Revolution and The Formula: How Algorithms Solve All Our Problems … and Create More, both published by Penguin/Random House. His tech writing has also appeared in Wired, Fast Company, Techmeme and other publications.
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