TAIPEI (TVBS News) — Hon Hai Technology Group (Foxconn, 鴻海科技集團), Taiwan's largest electronics manufacturer, and TECO Electric & Machinery Co., Ltd. (東元電機) witnessed dramatic stock price surges Thursday (July 31) following their strategic partnership announcement. Hon Hai's shares climbed over 3% to NT$178 (around US$5.9), while TECO's shares hit the daily limit-up, gaining NT$4.6 (around US$0.15) to NT$51 (around US$1.7) with trading volume exceeding 4,000 lots.
Hon Hai's Chairman Young Liu (劉揚偉) emphasized that modular designs are gaining popularity as demand for AI data centers surges globally. The electronics giant plans to leverage its vertically integrated capabilities in AI server racks to develop a modular architecture for AI data centers. Hon Hai will harness TECO's expertise in data center electrical engineering to provide a more complete and efficient one-stop solution for international clients.
The two companies agreed to a share swap arrangement, with TECO exchanging one share for 0.305 shares of Hon Hai. The transaction will result in Hon Hai holding a 10% stake in TECO, while TECO will own approximately 0.519% of Hon Hai. TECO stated that the alliance will offer comprehensive data center modular products and services, targeting lucrative markets in Taiwan, Asia, the United States, and the Middle East. ◼ (At time of reporting, US$1 equals approximately NT$29.928)