Foxconn to Invest in Simplo and Battery Manufacturing
Foxconn Electronics (the registered trade name of Hon Hai Precision Industry of Taiwan) will invest NT$1.43 billion (US$43.37 million) through a private placement and take a major stake in battery maker Simplo Technology. Some observers estimate that Foxconn will have a 9% stake in Simplo, replacing Quanta Computer (5%) as Simplo’s biggest shareholder.
Simplo’s Chairman, Sung Fu-hsiang, claimed that Foxconn will not take over Simplo’s management, and that Simplo, with its expertise in battery technology, will continue to be in control of developing its battery business. Sung also stated that the strategic partnership with Foxconn, which needs to source a large volume of batteries for its many products, will facilitate Simplo’s development, particularly in the single-core battery market that Simplo entered last year. Simplo expects the benefits of the strategic partnership with Foxconn to become apparent in the fourth quarter, and significant benefits to come in 2008 and 2009.