Hon Hai exec to take helm at Asia Pacific Telecom
By Ted Chen, The China Post
July 15, 2014, 12:00 am TWN
TAIPEI, Taiwan -- Reports indicate that Lu Fung-ming (呂芳銘), an executive overseeing one of Hon Hai Precision Industry Co.'s (鴻海) numerous business groups is poised to take the chairmanship of Asia Pacific Telecom (APT, 亞太), following the resignation of outgoing chairwoman Chiu Chun-chi (邱純枝) taking effect last Sunday.
Lu's ascension to the APT chairmanship represents a significant milestone in the merger process between APT and Ambit Co. (國碁), Hon Hai's telecoms arm.
Previously, Ambit had acquired 583 million APT shares through a private placement, taking a 14.99-percent stake in the company at a cost of NT$11.657 billion. The union of the companies is poised to be completed through a share swap between Ambit and APT.
APT also announced an extraordinary shraeholders' meeting to be held on Aug. 29 to go over the details of the merger, and the forthcoming inclusion of Hon Hai executives on the company's board of directors.
Most notably, Hon Hai has reportedly shifted stance in its 4G ambitions, and will likely devote the conglomerates resources towards capturing the telecoms market under the APT banner, instead of its subsidiary Ambit. Industry observers had previously expected the two companies to initiate a merger following a period of competing separately in the market for Ambit to recover the considerable expense it devoted in pursuit of its 4G network.
With the support of Hon Hai's considerable resources, and key bandwidth blocks residing in the 700MHz and 900MHz band secured through last year's operating license auctioning by regulators, APT is poised to become a force to be reckoned with in the local telecoms sector, said industry analysts. The company may even unseat Chunghwa Telecom from its leading position in the local market, while applying competitive pressure to Taiwan Mobile (台灣大) and Far EasTone (遠傳), the two other members of Taiwan's telecoms "big three", added industry analysts.
Meanwhile, Ambit declined to comment on rumors that the company is dropping out of competing in the 4G market.
Hon Hai Chairman Terry Gou had earlier stated that although APT will not begin offering 4G service to subscribers before the end of this year, the company's network, poised to launch early next year, will offer consumers stellar quality at lower prices through the pooled resources of the two companies.