Foxconn Buys Stake in 4G Mobile Operator
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
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.
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?
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.