Sony Taiwan Limited and Sony Taiwan Industries Co., Ltd. applied for merger approval
Case:
Sony Taiwan Limited and Sony Taiwan Industries Co., Ltd. applied for merger approval
Key Word:
merger
Reference:
Fair Trade Commission Decision of September 14, 2001 (the 514th Commissioners' Meeting); Decision (90) Kung Chieh Tzu No. 784
Industry:
Semi-conductor Manufacturing Industry (2710)
Relevant Laws:
Summary:
1. Sony Taiwan Limited and Sony Taiwan Industries Co., Ltd. are both Chinese Taipei subsidiaries of the Sony group. Their major shareholders are Sony Group's holding company in Holland - Sony Holding Co. To fully utilize the assets, personnel, resources and technology of its subsidiaries, the Sony Group plans to have the two [Taiwanese] subsidiaries merged. The merger may help replenish Sony Corp.'s funding by improving its financial structure, reducing its debt interest burden and permit improved financial management. 0. Because the planned merger falls within the type of mergers defined in Article 6(1)(i) of the Fair Trade Law (FTL): "where an enterprise and another enterprise are merged into one," an application was filed with the Fair Trade Commission (FTC) for approval under Article 11(1)(ii) of the FTL.2. It was found that Sony Taiwan Limited will be the surviving enterprise and Sony Taiwan Industries Co., Ltd. the dissolving one after the two are merged. This falls within the type of mergers defined in Article 6(1)(i) of the FTL: "where an enterprise and another enterprise are merged into one." Sony's sales for the preceding fiscal year (from 1 April 2000 to 31 March 2001; the 2001 fiscal year) was NT$870 million. This exceeds the publicly announced threshold under Article 11(1)(iii) of the FTL requiring the filing of an application for approval. The merging enterprises must apply with the FTC for approval.
3. The merging enterprise, Sony Taiwan Limited, specializes in the sale of semiconductors and related electronic components. Since the second half of 2000, Sony has expanded its business to include sales of lithium batteries and related components, special equipment for broadcasting and television and related components, documentary press and business relating to energy. It holds a 30 % share of the lithium battery market. 2. Sony Taiwan Industries Co., Ltd. was originally located in the Kaohisung Export Processing Zone. It specializes in the manufacture and distribution of Sony telephones, mobile phones, lithium batteries and other related components, mainly for export.
The only business area where the two merging enterprises overlap is lithium batteries. Sony Taiwan Industries Co., Ltd. is presently downsizing. It has only two employees and has ceased manufacturing. It has virtually no business or turnover volume. It has also moved to the same location where Sony Taiwan Limited is located. The merger is unlikely to cause significant effect on said market. There should be very little concern over whether the merger may restrict market competition. The merger seeks only to streamline the operations and reorganize the financial structure of Sony Taiwan Industries Co., Ltd. Therefore, the merger will not create an obviously adverse effect on the competition structure in a specific domestic market and may improve the confidence and assessment of foreign enterprises (such as Sony Group) in Chinese Taipei's investment environment. The application is hereby approved under Article 12 of the FTL. Appendix: Sony Taiwan Limited's Uniform Invoice Number: 23529362 Sony Taiwan Industries Co., Ltd.'s Uniform Invoice Number: 89002305 Summarized by Hsu, Tuan-Ying; Supervised by Shih, Chin-Tsun