TAIPEI: State-run financial institutions announced plans to buy a 7.7 percent stake in Taipei Financial Center Corp from Cathay Financial Holding Co, a deal that would expand the government’s majority stake in the Taipei 101 operator.
The transaction, which still requires the approval of the Financial Supervisory Commission, would cost NT$2.79 billion (US$90.69 million), or NT$27.9 per share, the parties involved said in separate stock exchange filings.
The figure is much lower than an earlier NT$46 per share offer by a Malaysian land developer for Ting Hsin International Group’s 37.17 percent stake in TFCC.
The Ministry of Finance, the largest shareholder of state-run financial institutions, said it welcomes the development and would next seek to win a majority of seats in TFCC’s board in December.
“We aim to consolidate control in the landmark building, the venue for New Year’s Eve fireworks and other nationally important events,” Vice Minister of Finance Wu Tang-chieh told a media briefing.
The ministry, which currently has a 44.35 percent stake in TFCC, thwarted Ting Hsin’s attempt to sell it to the Malaysian developer, citing concerns over potential boardroom instability.
Ting Hsin was pressured by the ministry to liquidate its TFCC shares because of its involvement in a series of food safety scandals.
Wu declined to say if the food conglomerate should press ahead with plans to sell its TFCC shares, except to say that all companies involved should cooperate to advance the interests of TFCC and the building.
The state-run financial institutions include Mega International Commercial Bank, First Commercial Bank , Hua Nan Commercial Bank , Taiwan Cooperative Bank, Taiwan Business Bank and Taiwan Asset Management Co , Vice Minister of Finance Wu Tang-chieh told a media briefing.
The six companies held four discussions with Cathay Financial over the share price, and the ministry would respect the offer, which would raise the government’s stake in TFCC to 52 percent, Wu said.
With a 7.7 percent stake, Cathay Financial topped the government’s target list in its effort to secure majority control of TFCC, Wu said.
