TSMC, the world's top contract chip maker, said on Friday it will increase its stake in Vanguard International to nearly 38 percent by purchasing 11 percent of the firm's shares via block trade.
TSMC said it would pay no more than T$5.55 billion or T$29.70 per share for the extra stake, a 6.8 percent premium to Vanguard's closing price on Friday of T$27.80, according to Reuters calculations.
This planned transaction will strengthen our business alliance with Vanguard and is part of our eight-inch wafer strategy, said Lora Ho, TSMC Spokesperson and Chief Financial Officer in a statement.
Future purchases of shares in Vanguard, if any, will depend on Vanguard's share price and the semiconductor industry's environment, Ho said. In addition, TSMC has no intention of taking over Vanguard, she said.
TSMC currently owns approximately 26.8 percent of Vanguard International's shares.
Shares of TSMC finished 1.91 percent lower on Friday, underperforming a 0.49 percent slide in the broader TAIEX market. Vanguard International closed up 1.83 percent.