Taiyen to Acquire Remaining 33.25% Stake in Taiyen Green Energy, Becoming a Full Subsidiary
Table of Contents
You might want to know
- Why is Taiyen acquiring the remaining shares of Taiyen Green Energy?
- How does this acquisition impact Taiyen Green Energy's future operations?
Main Topic
On October 28th, Taiyen (1737-TW) announced its board's decision to acquire the remaining 33.25% of shares in Taiyen Green Energy. This decision was made in accordance with the applicable corporate merger laws. The acquisition will be accomplished through a stock conversion transaction, with Taiyen paying NT$0.917 per share in cash. The transaction involves purchasing 12,325 shares for a total consideration of approximately NT$11.3 million, thereby making Taiyen Green Energy a fully-owned subsidiary. The primary goal behind this acquisition is to optimize the corporate structure and operational efficiency of Taiyen Green Energy amidst its ongoing operational challenges.
Currently, Taiyen Green Energy has a capital of NT$371 million, with Taiyen already holding 66.75% of its shares. The remaining shares are owned by private shareholders and employees. The decision to transform Taiyen Green Energy into a wholly-owned subsidiary was supported by the Ministry of Economic Affairs and approved by the company's board. According to Taiyen's Chairman, Mr. Ting Yen-Che, this move aligns with Taiyen's corporate image and responsibility as a publicly affiliated entity.
The financial legitimacy of the transaction was verified by Eslite Joint CPA Firm and Cheng Tai Joint CPA Firm. Accountants Lai Ming-Yang and Hsu Hao-Wen provided assessments supporting the reasonableness of the pricing, which is derived from a valuation range between NT$6.486 million and NT$16.116 million, with the median valuation pegged at NT$11.302 million.
Previously, Taiyen Green Energy faced managerial issues, including several unprofitable contracts under prior managers, leading to poor operational performance. This scenario resulted in legal action initiated by the Tainan District Prosecutors Office as of February 27, seeking penalties for the implicated members. By the end of 2024, the company's accumulated losses are projected to expand to 94.58% of its capital. With Taiyen's acquisition, it aims to implement resource integration strategies across the group, effectively managing legal risks to secure the interests of both the company and its stakeholders.
Key Insights Table
| Aspect | Description |
|---|---|
| Acquisition Cost | NT$0.917 per share, totaling NT$11.3 million. |
| Current Shareholding | Taiyen owns 66.75% of Taiyen Green Energy. |
| Projected Loss | Losses could reach 94.58% by end of 2024. |
| Legal Actions | Ongoing lawsuits related to previous management contracts. |
Afterwards...
Going forward, Taiyen plans to leverage its resources to implement comprehensive management practices and strategically integrate group resources to counter the operational challenges faced by Taiyen Green Energy. The company also aims to manage future legal disputes with a focus on safeguarding the company's assets and relationships with stakeholders. Exploring new innovative green technologies and sustainable practices stands out as a crucial area of development and investment, aligning with the broader industry focus on environmental sustainability.