Taiwan's Asustek announced on December 11 that
the company will spin off its wholly-owned contract manufacturing unit Pegatron
and reduce its shareholding to 25%, according to Taiwan's Central News Agency. The
divestiture is seen as an attempt by Asustek, having switched its corporate
focus to own-brand operations, to draw a definite demarcation line between
brand identity and contract manufacturing business. A new company named Pegatron
Investment Holdings Company will therefore be created, in which Asustek will
merely retain a 25% stake. Furthermore, Asustek will reduce the number of shares
issued by the company by 85% and assign all shareholders shares of equivalent
value in Pegatron.
Asustek first turned its contract manufacturing arm
into the wholly-owned Pegatron back in 2008. The further step towards complete
spinoff is still pending approval by the shareholders' meeting slated for
February 9, 2010. Transaction is expected to take effect on July 1, 2010.