Shibaura executives endorse Yageo's business transaction
In a significant development, Yageo Corp has secured foreign direct investment clearance for its takeover bid of Shibaura Electronics Co. This clearance removes the sole regulatory obstacle for closing the deal, valued at NT$22.83 billion (US$759.4 million).
The bid, launched in May, aims to acquire all 15.25 million Shibaura shares in cash. Yageo has expressed appreciation to Shibaura's leadership team, board of directors, and special committee for their support.
Shibaura has agreed to Yageo's proposal, believing that the combination will enhance its sales in Europe, the US, and China, and broaden its product portfolios. The deal is expected to help uphold Shibaura's corporate values.
High-ranking executives from both companies met in Taipei in July, followed by visits to Yageo's manufacturing facilities in Kaohsiung and Thailand. These meetings seem to have played a crucial role in Shibaura's decision to support the deal.
However, there is no publicly available information about which persons from Shibaura Electronics Co visited the production facilities of Yageo Corp in July.
The bidding price raised by Yageo is ¥7,130 per share, 15 percent higher than MinebeaMitsumi Inc.'s offer of ¥6,200. The extended deadline for the tender offer allows shareholders enough time to respond to Yageo's bid, with the offer now extended several times and having a deadline of Oct. 3.
If the tender offer meets the minimum acquisition of 7.62 million shares, or about 50 percent, the takeover bid is expected to succeed, and the deal is scheduled to close later this year.
Following the news, Yageo shares surged 4.35 percent to close at NT$156 in Taipei. The successful closing of the deal will mark a significant milestone for both Yageo and Shibaura, and the electronics industry as a whole.
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