Hon Hai Precision Industry Co on Thursday said its subsidiary Foxconn Singapore Pte Ltd. acquired approximately 351.73 million common shares in its India subsidiary Foxconn Hon Hai Technology India Mega Development Pvt Ltd, amounting to $37.2 million, according to a stock exchange filing.
Foxconn has been ramping up its presence in India significantly driven by demand from Apple but also its own '3+3+3 strategy' which looks to integrate three emerging industries, three core technologies, and three smart platforms to ensure long-term, sustainable growth for the Taiwanese contract manufacturer.
A significant chunk of this investment is expected to come to Tamil Nadu where the company currently has its largest footprint. However, the Taiwanese giant has been diversifying its operations with one of its biggest units globally coming up in Karnataka and another large unit already in operation in Telangana.
As per the filing, the purpose of the acquisition of shares in the Indian entity is listed as a 'long term investment' with the source of funding being mentioned as private capital. The company stated that the transaction does not involve a change in business model and that no dissenting opinions were recorded from directors regarding the transaction.
Following the transaction, Foxconn Singapore Pte Ltd. holds 23.18 billion shares in the India unit, representing a 99.99999996% shareholding with a cumulative value of $2.82 billion.
Another one of its India subsidiaries, Yuzhan Technology (India) Private Limited, holds 10 shares representing 0.00000004% of the India unit.
Yuzhan Technology, has started operations at its display module assembly unit in Tamil Nadu.
The securities investment represents 3.55% of Hon Hai’s total assets and 7.72% of equity attributable to owners of the parent, based on the most recent financial statement. The company reported working capital of NTD -317.91 billion.
