FSC refers case to Yuanta Funds after shareholders claim stock value was underestimated

(CNA, Taipei, June 9, Reporter Su Sih-yun) Yuanta Financial Holdings and Yuanta Funds recently passed a share swap plan to make Yuanta Funds a 100% subsidiary of Yuanta FHC, but some minority shareholders of Yuanta Funds claim their equity value was underestimated. The Financial Supervisory Commission (FSC) stated that current legal mechanisms provide sufficient protection for minority shareholder rights and the issue can be handled through existing procedures. The case has been referred to Yuanta Funds for processing.

In March of this year, the boards of directors of Yuanta FHC and Yuanta Funds approved a share swap plan for Yuanta FHC to acquire all shares of Yuanta Funds by issuing new shares. The exchange ratio is 1 share of Yuanta Funds for 5.2583 shares of Yuanta FHC, making Yuanta Funds a 100% subsidiary of Yuanta FHC. However, some minority shareholders of Yuanta Funds protested in front of the FSC this morning, questioning the undervaluation of their shares in the swap deal. They demanded that the regulatory authority intervene and investigate, and also called for legal amendments to protect minority shareholder rights, enhance information disclosure, and strengthen rights to remedies in major M&A cases.

Wang Yun-chung, Deputy Director of the FSC's Banking Bureau, stated that the FSC has received the petition. He clarified that the case clearly involves minority shareholders having objections to the acquisition price, and it has been referred to Yuanta Funds for handling.

Wang explained that under current law, the Business Mergers and Acquisitions Act and the Company Act have clear provisions regarding the appraisal rights of minority shareholders. When a company undergoes a merger or acquisition, if a shareholder has doubts about the deal or the acquisition price, they can raise objections orally or in writing before or during the shareholders' meeting and cast a dissenting vote. After this is recorded, they can, within 20 days of the meeting's conclusion, request in writing that the company purchase their shares at a fair price.

Wang pointed out that the current legal mechanisms provide sufficient protection for minority shareholder rights, and they can follow the existing procedures. (Editor: Yang Kai-hsiang) 1150609