TPG, Affinity make $1.4bn offer for UTAC(2)

TPG Capital and Affinity are proposing to delist a Singapore-listed semiconductor company for $1.4 billion. The offer follows a failed $1.6 billion buyout offer from Temasek Holdings for STATS ChipPac, another Singapore-listed chip company.

TPG Capital and Affinity Equity Partners are offering to acquire Singapore-listed United Test and Assembly Centre, in a transaction that values the microchip testing company at S$2.2 billion ($1.4 billion; €1.06 billion).

Affinity and TPG are offering S$1.20 cash for each share. The offer represents a premium of 30.4% to UTAC’s average share price over the last six months, and a 20 percent to the average for the past month.

The deal comes months after UTAC was identified as a buyout target following Temasek Holdings’ $1.6 billion take-private offer for STATS ChipPac, a chip tester and packager listed in Singapore and the US. Temasek failed to garner enough shares to take the company private.

Asia’s semiconductor industry has become a hot sector for private equity firms. However, acquisitions of public-listed companies have proven difficult. Failed bids include The Carlyle Group’s $5.5 billion offer for Taiwan’s Advanced Semiconductor Engineering. Carlyle was in exclusive negotiations to acquire ASE, the world’s largest chip packager, before the agreement was terminated in February.