U.S. News

Philips Raises $2.56 Billion from Sale of TSMC Stake


Dutch electronics firm Philips has raised $2.6 billion by selling a 4.6% stake in TSMC as part of
its plans to exit the world's top contract chip maker, a market source said on Friday. 

TSMC sold 240 million American Depositary Shares (ADSs) on behalf of Philips at US$10.68 per share at a U.S. auction, representing a nearly 5% stake, based on Reuters calculations. 

The sale price was the same as TSMC's closing price in New York on Thursday, but marked a 5.2% premium to the firm's closing price in Taiwan, according to Reuters calculations.

TSMC's Taiwan shares closed 1.7% higher at T$67.70 on Thursday, outpacing the TAIEX index's 0.62% gain.

Philips sold its first batch of TSMC shares in March, cutting its holding in the Taiwan firm to 12.8% from 16.2%.

One ADS equals five ordinary Taiwan shares. The pricing occurred after the New York markets closed on Thursday and just before markets opened for Friday trading in Taiwan.

TSMC is riding on a cyclical upturn driven by a new crop of computers and consumer products, including mobile phones, game consoles and flat-screen televisions.

TSMC has shown its confidence in the recovery by forecasting an improvement in sales and profit margins in the second quarter. Smaller rival United Microelectronics Corp. echoed the upbeat outlook from TSMC.