Foxconn lost the bidding for SilTerra in February. Now it is talking to the company that beat it.
Sources told Bloomberg News that the Taiwanese group, best known as the main assembler of Apple’s iPhones, is in talks to buy a stake in Malaysian technology firm Dagang NeXchange (DNeX). One source said Foxconn could take a minority holding and help expand SilTerra Malaysia, the chipmaker DNeX won in the February sale.
Nothing is settled. The sources said the talks are continuing, could fall apart, and carry no certainty of a deal. A DNeX representative said the company is always open to discussion with strategic partners and investors but cannot comment on any specific discussion. Foxconn declined to comment.
How DNeX won SilTerra
DNeX and a Chinese investor bid for SilTerra together and bought it from Malaysian sovereign wealth fund Khazanah Nasional for RM273 million. DNeX takes 60 per cent. The other 40 per cent goes to the Beijing Integrated Circuit Advanced Manufacturing and High-End Equipment Equity Investment Fund Center.
Hon Hai chairman Young Liu told reporters afterwards that the company still wanted a partnership with SilTerra. Hon Hai Precision Industry is Foxconn’s main listed arm.
DNeX shareholders have approved a private placement of up to 30 per cent of its shares, according to a company statement on May 20. The money will pay for the SilTerra purchase and other investments.
Market reaction
DNeX shares rose as much as 13.6 per cent in Kuala Lumpur after the Bloomberg report, their highest intraday level in more than a month. That put the company’s market value at about US$474 million.
A stake sale would fit Foxconn’s push into electric vehicles. The group unveiled its first electric vehicle chassis and a software platform in October, and has since made agreements with Chinese firms Zhejiang Geely Holding Group and Byton, the US company Fisker and Europe’s Stellantis.
DNeX, founded in 1970, also runs businesses in information technology, undersea telecommunications cables and oil and gas.
