Chang Wah Electromaterials (CWE) announced recently it will withdraw from Top Energy Saving System's (TESS) board. CWE planned to take over TESS management and acquire the company, but the merger deal has been called off since TESS former Chairman Tsai Wen-Kuei suspected violation of Taiwan's Securities and Exchange Act, said CWE Chairman and President Huang Chia-Neng.
CWE has successfully developed EMC LED lead frames, said Huang. The company planned to acquire TESS to expand its LED lighting strategy, obtain related technology, and establish product brand and exports.
The Securities and Futures Investors Protection Center demanded compensation from Tsai and other TESS members suspected of violating the Securities and Exchange Act. As a result CWE, which joined TESS board in June, quickly announced its decision of exiting the board. In addition, Huang declared resigning from TESS chairman.
CWE's investment plans in TESS were bogged down by legal limitations, said Huang. CWE will only be able to watch TESS's 108 employees lose their jobs as the company goes bankrupt. Since TESS terminated stock trade in late March 2013, CWE board passed an issuance of stock for cash plan in April this year, but has not executed the plan yet. According to Huang, the company will not give up its LED lighting strategy, and will be establishing a new subsidy and brand in the future.
