Since I wrote about this earlier, today is a conclusion. IOI’s proposed purchase of 101 Taipei is off. Yes, they proposed to buy 37.17% stake in Taipei Financial Centre, better know as Taipei 101, for RM2.74 billion from its owner, Ting Hsin International Group. Earlier, negative signs were already showing when the government (Taiwan’s Finance Minister Chang Sheng-ford).as well as the opposition parties all were very vocal about Taiwan losing control over its Taipei 101. In fact this time, the deal was off because IOI simply did not want to extend the three months period to obtain the approval from Investment Commission (FIA) of Taiwan which expired on March 5. IOI said that it will now, “In accordance with the SSA, the company will now proceed to obtain the refund of the deposits paid by IOI Properties.”
I think a few people would be disappointed. I do not think IOI would be the one most disappointed. This is what happens when everything got mixed up together instead of everyone able to think objectively from a business point of view. 37.17% is nowhere near 50%. Even if they were to try, they would not be able to exert control. However, allowing them to buy would have allowed investment to flow into Taiwan and the seller may be able to use the money to do something else which ultimately benefits the company and the country in the future. Alas, the thinking is again along the lines of loss of votes and the decision is based on popularity and not free economy as espoused by many in developed nations. Oh yeah, Taiwan is not the only one. Australia, USA and many other advocates of freedom of intervention do it ALL the time.
Well, now IOI has more options to evaluate. Hey, perhaps they may just launch more projects faster? I think in the near future, Taiwan is definitely not in their mind. Oh yeah, IOI had also earlier announced that it has no interest in seeking management control but I think this was overlooked totally. To anyone who believe that only certain countries stop investments, think again. All these are always based on public opinion as well and Taipei 101 happened to be a national icon, that’s all. Happy reading.
written on 5 Feb 2015
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