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Foxconn Buys Stake in 4G Mobile Operator

Dan Jones
5/27/2014
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Taiwan's Foxconn -- the manufacturer of Apple's iPhone -- is acquiring a US$390 million stake in domestic mobile operator Asia Pacific Telecom, according to local news reports.

Foxconn Electronics Inc. , which trades on the Taiwan stock market under the name Hon Hai Precision Industry Co Ltd, will pay NT$20 a share for 582.9 million shares in Asia Pacific Telecom Group . The Star Online reports that the deal values a 15 percent stake in the operator at NT$11.6 billion (US$390 million).

Foxconn is expected to try for a full merger with the operator through a future share swap.

The deal gives Foxconn a stake in the emerging Taiwanese 4G mobile market: Asia Pacific Telecom is Taiwan's fourth largest mobile operator, and has about 2.1 million customers. (See APAC Fuels 4G Action.)

— Dan Jones, Mobile Editor, Light Reading

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pcharles09
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pcharles09,
User Rank: Light Beer
5/29/2014 | 9:03:06 PM
Re: So where really is the synergy here?
R Clark,

Diversifying is the word I was looking for here. That's always the name of the game when you've already cornered one aspect of a market.
pcharles09
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pcharles09,
User Rank: Light Beer
5/29/2014 | 9:01:47 PM
Re: So where really is the synergy here?
Previously replied to below...
pcharles09
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pcharles09,
User Rank: Light Beer
5/29/2014 | 9:01:21 PM
Re: So where really is the synergy here?
I'm looking at it more from a business opportunity perspective of the ownership, not the end users.
R Clark
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R Clark,
User Rank: Blogger
5/27/2014 | 11:18:00 PM
Re: So where really is the synergy here?
Foxconn/Hon Hai is an electronics contract manufacturer, so it doesn't compete directly with operators.

This is all about diversifying away from manufacturing. Hon Hai is also tipping money into cloud and software apps and is even making some of its own-branded accessories like headphones.
nasimson
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nasimson,
User Rank: Light Sabre
5/27/2014 | 11:08:37 PM
Re: So where really is the synergy here?
@pcharles: What kind of tie ins are you referring to here? For the common cellphone-plan tie ins, you don't need an ownership stake.
nasimson
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nasimson,
User Rank: Light Sabre
5/27/2014 | 11:08:13 PM
Re: So where really is the synergy here?
@pcharles: What kind of tie ins are you referring to here? For the common cellphone-plan tie ins, you don't need an ownership stake.
pcharles09
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pcharles09,
User Rank: Light Beer
5/27/2014 | 7:59:01 PM
Re: So where really is the synergy here?
They'll have more tie-in into the industry by being aligned with the providers as well as the manufacturing.
sam masud
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sam masud,
User Rank: Light Sabre
5/27/2014 | 3:39:10 PM
Re: So where really is the synergy here?
It's more than a device manufacturer--Foxconn is a major bare metal box maker.
DanJones
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DanJones,
User Rank: Blogger
5/27/2014 | 2:19:29 PM
Re: So where really is the synergy here?
Well, Foxconn is the largest electronics manufacturer in the world and the 3rd largest IT company they are widely known for making iPhones but that's not all they make. It's not something I've seen before, for sure.
nasimson
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nasimson,
User Rank: Light Sabre
5/27/2014 | 12:30:26 PM
So where really is the synergy here?
@ Dan:

If my memory serves me right, I have never heard of a device manufacturer buying stakes in the mobile operator.

What exactly are the synergies here? Am I missing something?
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