DAGANG NeXchange Bhd (DNeX) has announced that Foxconn Singapore Pte Ltd, a subsidiary of Hon Hai Precision Industry Co Ltd, has emerged as a substantial shareholder of DNeX with a 5.03% stake.
DNeX received an official notification from Foxconn on June 13 that it had acquired 120 million shares from the existing shareholders of DNeX.
“DNeX is always open to any collaboration with strategic partners and investors that can bring value to the group,” commented DNex’s group managing director Tan Sri Syed Zainal Abidin Syed Mohamed Tahir.
“We welcome the entrance of the new shareholder, Foxconn. We foresee this latest development can bring great potential to DNeX and we believe Foxconn’s entry can offer opportunities to unlock and create value across the high technology sector value chain and beyond.”
The emergence of Hon Hai Precision Industry Co Ltd or Foxconn Technology Group as a 5.03% shareholder in DNeX gives rise to an interesting partnership in the company which is in the midst of taking over SilTerra Malaysia Sdn Bhd, according to The Edge Weekly.
DNeX is taking up a 60% stake in SilTerra while Beijing CGP Fund is taking up the remaining 40% in the semiconductor wafer manufacturing plant. The total acquisition cost is RM273 mil.
Taiwan-based Foxconn was one of the bidders for SilTerra and had put in the highest price. It did not win, probably because some quarters contended that the company should remain Malaysian-owned.
Syed Zainal Abidin said potential areas for collaboration between DNeX and Foxconn are semiconductor and downstream products, electric vehicle and businesses related to the electric vehicle value chain.
Moving forward, he said DNeX is focused on growing its business and transforming the company into a technology player capable of competing in the global marketplace.
Together with Beijing Integrated Circuit Advanced Manufacturing and High-End Equipment Equity Investment Fund Center (Limited Partnership) (CGP Fund), DNeX is currently finalising the acquisition of SilTerra Malaysia Sdn Bhd which manufactures semiconductor wafers that are supplied to multinational fables and integrated device manufacturer companies.
“The outlook of the semiconductor sector is expected to stay bullish with increasing demand continuing up to 2024 which can lead to sustainable positive earnings for SilTerra and DNeX,” projected Syed Zainal Abidin.
“This makes the acquisition of SilTerra timely and strategically compelling for DNeX. We are confident that our business in the semiconductor market will grow at a strong pace.”
At the close of today’s morning session, DNeX was up 1.5 sen or 1.74% to 87.5 sen with 51.2 million shares traded, thus valuing the company at RM2.09 bil. – June 14, 2021
