ASMI to sell stake in Hong Kong-listed arm

ASM International fell up to 16 per cent after saying it plans to sell a stake in Hong Kong-listed ASM Pacific Technology in an effort to increase the value of its combined businesses.

The company is selling 8 per cent to 12 per cent of ASM PT, ASMI said. The price is HK$88.88 to HK$91.77 a share, according to a term sheet obtained by Bloomberg News, which would raise a maximum of US$567 million.

"This is clearly disappointing news," said Jos Versteeg, an analyst at Theodoor Gilissen Bankiers. "People were anticipating a breakup of the company, and this is kind of a setback. I think the company decided it still needs ASM PT as a cash cow."

The sale follows a study of the market valuation of the combination, after investors pressed ASMI to separate its two businesses.

The alternatives that were investigated included a full or partial placement or sale of the company's stake in ASM, a spin-off of shares in ASM and merger options, the Netherlands-based company said.

"A partial secondary placement of 8 per cent to 12 per cent of the company's stake in ASM PT is the most suitable step to be taken to address the non-recognition by the markets of the value of the combined businesses," ASM International said yesterday.