Shares of Dagang NeXchange Bhd (DNeX) rose as much as 13.6 per cent in Kuala Lumpur after Bloomberg News reported that Foxconn Technology Group wants to buy into the company. The gain was the stock’s best intraday level in over a month and left DNeX valued at about US$474 million.
Sources told Bloomberg the Taiwanese group, best known for assembling Apple’s iPhones, is in talks about a minority stake. One of them said Foxconn would help expand SilTerra Malaysia, the chipmaker DNeX bought in February after outbidding Foxconn for it.
The sources cautioned that discussions are continuing but may fall apart. A DNeX representative said the company welcomes talks with strategic partners and investors, without addressing any specific discussion. Foxconn’s representative declined to comment.
The SilTerra purchase
DNeX and a Chinese investor paid RM273 million (S$87 million) to Malaysian sovereign wealth fund Khazanah Nasional Bhd. for SilTerra. DNeX will hold 60 per cent. The partner, the Beijing Integrated Circuit Advanced Manufacturing and High-End Equipment Equity Investment Fund Center, will hold the other 40 per cent.
Young Liu, chairman of Hon Hai Precision Industry, Foxconn’s primary listed arm, told reporters after the loss that the company still hoped to partner with SilTerra.
On May 20, DNeX said its shareholders had approved a private placement of as much as 30 per cent of its shares. It plans to use the money for SilTerra and other investments.
Foxconn and electric vehicles
Any stake sale would arrive while Foxconn is widening its electric vehicle business. Since unveiling its first EV chassis and a software platform in October, it has announced agreements with Zhejiang Geely Holding Group and Byton of China, Fisker of the US, and Stellantis of Europe.
DNeX was founded in 1970. Its website lists information technology, undersea telecommunications cables and an oil and gas unit among its businesses.
