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June 23, 2017

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Memory chip maker Rexchip may get delisted

Rexchip, a memory chip manufacturer traded on Taiwan's emerging stock market, is likely to get delisted after both its chief underwriter and associate underwriter resigned, the firm said.

GreTai Securities Market, the platform on which emerging stocks are traded, said yesterday it hasn't received official documents from Rexchip. Once it receives those documents it will announce the delisting of Rexchip.

The incident came after Cathay Securities resigned as the firm's chief underwriter. Days later, Grand Cathay Securities also resigned as its associate underwriter. Now that the firm no longer has an underwriter, it will be delisted, following Taiwan's securities trading rule.

"The actual date of delisting will be based on the official announcement of GreTai Securities Market," Rexchip said.

The development has caused panic among investors, who led a selling spree that sent Rexchip's stock price down to less than NT$4.

Rexchip was a joint venture between Powertech Technology and Elpida, both memory chip manufacturers, back in 2006. With a downturn in the memory market, Powertech has sold all its holdings in Rexchip to Micron, which has also acquired Elpida.

Separately, Powertech also faces the prospect of delisting, after its debt ratio exceeded 100 percent in both August and September. With this, Powertech stock's net worth is all but certain to stay negative for the third quarter.

The firm got relisted on the over-the-counter market on Sept. 28 after a reduction in capital. Since then the stock has fallen for 13 consecutive sessions.

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