VIA Technologies, a company widely known for manufacturing computer parts, particularly motherboard chipsets, has acquired the graphics division of S3 Graphics, Ltd. in 2001. In 2005, S3 Graphics run out of enough capital to operate and with the help of a private investment company WTI Investment International, Ltd., VIA Technologies continue the operation of S3 Graphics joint venture.
In the acquisition agreement, HTC is said to pay $300 million for all the outstanding shares of S3 Graphics, in which $147 million will go to VIA and the remaining $153 million is for WTI Investment International. The acquisition is expected to be completed before end of 2011.
HTC’s Chairwoman, Cher Wang, is also a Chairwoman of VIA Technologies and a shareholder of WTI. So the acquisition of VIA and WTI’s shares isn’t that hard for the Taiwanese smartphone maker. Though we can say that HTC is strengthening graphics performances of its future devices through S3’s technology, it’s more interesting to note the company probably has been beefing up its patent defense against Apple. A year ago, Apple filed a suit against HTC for various multitouch patent disputes. The Cupertino company however, also had violated two patents of S3 Graphics in which the latter won in the ruling last month. Now that HTC will soon own S3 Graphics, it’s no doubt the move will position the company with stronger defenses against Apple patents in the future. [via]
VIA Technologies Announces Sale of Stake in S3 Graphics
Taipei, Taiwan, July 6, 2011 – VIA Technologies, Inc. (“VIA”) today announced the signing of definitive agreement to sell all of its shareholding in S3 Graphics Co., Ltd. (“S3 Graphics”) to HTC Corporation (“HTC”). S3 Graphics is a leading provider of innovative graphics visualization technologies used in PCs, game consoles and, more recently, mobile devices.
VIA acquired S3 Graphics in 2001 with the intention to accelerate integration of graphics capabilities with its processor and chipset products. S3 Graphics became undercapitalized in 2005, and VIA introduced WTI Investment International, Ltd. (“WTI”) as a new investor to help fund the operations and R&D initiatives. WTI is a private investment company, in which Cher Wang, Chairman of VIA, is a significant shareholder.
Under terms of the agreement with HTC, total consideration for all outstanding shares of S3 Graphics will be US$300 million. Of which, VIA will receive US$147 million; and WTI will receive US$153 million. VIA will recognize a capital gain of US$ $37 million and paid-in-capital of US$ 115 million in this transaction.
“The transaction would allow VIA to monetize a portion of its rich IP portfolio, yet retain its graphics capabilities to support the development and sale of its processors and chipsets,” said Tzu-mu Lin, Senior Vice President and Board Director of VIA. “We wish to thank WTI for its capital contribution to support S3 Graphics since 2005.”
The proposed transaction has received approvals from the boards of directors of VIA, WTI, and HTC. Subject to regulatory approvals and other customary conditions, the transaction is expected to close before end of 2011.
About VIA Technologies, Inc.
VIA Technologies, Inc. is the foremost fabless supplier of power efficient x86 processor platforms that are driving system innovation in the PC, client, ultra mobile and embedded markets. Combining energy-saving processors with digital media chipsets and advanced connectivity, multimedia and networking silicon enables a broad spectrum of computing and communication platforms, including its widely acclaimed ultra compact mainboards. Headquartered in Taipei, Taiwan, VIA’s global network links the high tech centers of the US, Europe and Asia, and its customer base includes the world’s top OEMs and system integrators. www.via.com.tw