Without Taiwan's Investment Commission approval, Taiwanese LED manufacturer FOREPI's and Chinese manufacturer San'an Optoelectronics' (San'an) ownership stake acquisition deal was thwarted. FOREPI's board of directors approved San'an as a shareholder in private investment in late June, and recently planned to start a new LED company through a joint venture with TCL and Refond. The two approaches show FOREPI's ambition and strategy in the Chinese LED market.
In November 2012, FOREPI's board of directors approved San'an's acquisition of 120 million shares, totaling to NTD2,352 million. The deal is expected to give San'an a 19.9% share of FOREPI.
FOREPI's board authorized sales of 120 million shares at NTD19.6 per share via joint venture on June 28, 2013. FOREPI is cooperating with major international manufacturers through private investment, and targeted San'an as the private investor, allowing San'an to obtain a 19.9% share of FOREPI.
According to market sources, Taiwan's Investment Commission has sent the investment case to the Industrial Development Bureau for further assessments, as this is the first ownership stake acquisition deal since Taiwan's Executive Yuan relaxed restrictions on Chinese investments in seven highly sensitive key industries. An additional area of concern is San'an's financial scandal in April, which has made relevant authorities in Taiwan even more cautious about the investment.
As LED is still one of Taiwan's seven key technology industries, regulations cap Chinese investors stock ownership at 20%. Concerns surrounding San'an and FOREPI's abilities of proposing a reasonable cooperation development strategy are also a factor as to why Taiwan's MOEA refuses to give the joint venture a green light.
