Asia Express - Computing
Asustek to Spin Off Contract Manufacturing Unit Pegatron, Reduce Shareholding
December 11, 2009
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.