Taiwan's Asustek to free up subsidiary by June - report

 @ibtimes
on January 01 2010 11:32 PM

Taiwan netbook PC pioneer Asustek has approved plans to simplify cutting investment in its subsidiary Pegatron, which could be listed in June, a newspaper said on Saturday.

The company's board agreed to the plans on Friday for reducing its share in Pegatron, a fully owned contract manufacturing subsidiary, by June 1, a month earlier than anticipated, Taiwan's Commercial Times reported.

The spinoff could be listed by June 24, the paper said.

Asustek will reduce its holding in Pegatron to 25 percent, a move to reduce any conflict of interest between the two sides. The firm said last month it would cut the number of shares issued by 85 percent.

Company sources were not available for comment on Saturday.

Asustek started as a contract manufacturer of motherboards, but has increasingly turned to selling laptop PCs for higher profit margins, spinning off its manufacturing arm in 2008 into a fully owned subsidiary company.

However, Pegatron has been unable to compete effectively with bigger rivals such as Hon Hai and Quanta over fears that the information and profit it receives may be used to benefit Asustek.

(Reporting by Ralph Jennings)

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