Weltrend Semiconductor : The Company plans to acquire the ordinary shares of Sentelic Corporation through a public tender offer ("Tender Offer")

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Provided by: Weltrend Semiconductor, Inc.
SEQ_NO	1	Date of announcement	2022/07/28	Time of announcement	15:19:22
Subject	The Company plans to acquire the ordinary shares of Sentelic Corporation through a public tender offer ("Tender Offer")
Date of events	2022/07/28	To which item it meets	paragraph 38
Statement	1.Date of reporting of public tender offer:2022/07/28 2.Company name of the public tender offeror:Weltrend Semiconductor, Inc. 3.Company location of the public tender offeror: 2F., No. 24, Industry E. 9th Rd., Hsinchu Science Park 4.Business Registration Certificate No.of the public tender offeror:22099499 5.Name of the public company whose securities are to be acquired: Sentelic Corporation ("Target") 6.Type of securities to be acquired:Ordinary Shares 7.No.of securities to be acquired: 15,324,000 shares (anticipated maximum number of shares to be acquired) 8.Expected price of the securities to be acquired:NT$72.9 per share 9.Scheduled period of the public tender offer: Begin on July 29, 2022 ("Commencement Date of Tender Offer Period") and end on August 17, 2022 ("Expiration Date of the Tender Offer Period"), time to accept tender is every business day from 9:00AM to 3:30PM (Taiwan time) during the tender offer period. The Company may report to the Financial Supervisory Commission in accordance with applicable laws and make a public announcement of an extension of the tender offer period for a period of not exceeding 50 days. 10.Purpose of the public tender offer: Both the tender offeror and the Target are mainly focus on IC design. The Target's main product line is motor control IC for cooling fans, and the tender offeror has also been actively developing this product line for many years. The tender offeror believes that after the completion of this tender offer, both companies will bring complementary benefits, enhance the competitiveness of both companies and create synergy. 11.Conditions of the public tender offer: (1)Tender Offer Period： Begin on July 29, 2022 ("Commencement Date of Tender Offer Period") and end on August 17, 2022 ("Expiration Date of the Tender Offer Period"). Time to accept tender is every business day from 9:00AM to 3:30PM (Taiwan time) during the tender offer period. The Company may report to the Financial Supervisory Commission in accordance with applicable laws and make a public announcement of an extension of the tender offer period for a period not exceeding 50 days. Please refer to the tender offer prospectus for the time and method of accepting tender for each business day. (2) Maximum and minimum number of shares to be acquired: The tender offeror intends to acquire 15,324,000 shares ("Max Quantity of Shares"), representing around 51.00% of the total issued shares of 30,047,000 shares of the Target's total issued ordinary shares as recorded by the Department of Commerce, MOEA on June 10, 2022. However, if the number of effective tendered shares does not reach the Max Quantity of Shares but reaches the minimum acceptance threshold of 13,522,000 shares ("Minimum Quantity of Shares"), representing around 45.00% of the total issued shares of the Target, the conditions of the Tender Offer will be deemed fulfilled. When all conditions of the Tender Offer are fulfilled (the number of effective tendered shares reaches the Minimum Quantity of Shares) and the tender offeror does not suspend the Tender Offer under the applicable laws, the tender offeror will acquire the shares of the Target to the extent not exceeding the Max Quantity of Shares. Once the number of effective tendered shares exceeds the Max Quantity of Shares, the tender offeror will acquire the shares on a pro rata basis as stated in the tender offer prospectus. Those whose tendered shares less than 1,000 shares will not be accepted. (3) The consideration of the Tender Offer: The consideration of the Tender Offer is NT$72.9 per share in cash. Offerees to the Tender Offer shall be responsible for their own securities transaction tax, income tax (if any), handling charge of TDCC and securities brokers, bank charges, postage fees, other necessary and reasonable fees related to the payment of consideration. If there are any additional fees to be borne by the offerees, the tender offeror and the mandated institution will make a public announcement according to the applicable laws. The amount paid by the tender offeror will be the purchase price after deducting the abovementioned expenses and will be rounding down to the nearest dollar (Remainders less than one dollar will be discarded). (4) Tender offer consideration settlement date: When all conditions of the Tender Offer are fulfilled and the tender offeror or the financial institution who issuing the performance guarantee has completed the remittance on time, Taishin Securities will perform payment of the tender offer consideration within 5 business days (inclusive) after the expiration day of the tender offer period (or the extended tender offer period, as the case may be). (5) Other FSC or other regulatory approval or filing required for the Tender Offer: The tender offer shall not be made until after a filing has been made with the Financial Supervisory Commission and a public announcement made in accordance with the Article 43-1, Paragraph 2 of the Securities Exchange Law and Article 7, Paragraph 1 of the Regulations Governing Public Tender Offers for Securities of Public Companies. The tender offeror has made the announcement on July 28, 2022, and the relevant documentation will be filed with the Financial Supervisory Commission on the same day. The tender offeror does not need to obtain approval from other competent authorities for the Tender Offer. (6) After the conditions of the Tender Offer have been fulfilled, the offerees may not revoke their acceptance after the tender offeror has made a public announcement, except under any of the circumstances specified in Article 19, Paragraph 6 of the Regulations Governing Tender Offers for Securities of Public Companies. (7) Please refer to the tender offer prospectus for other detailed conditions of the Tender Offer. Webpage to inquire tender offer prospectus：MOPS: https://mops.twse.com.tw 12.Name of the appointed institution:Taishin Securities Co., Limited 13.Location of the appointed institution: 2F, No. 44, Sec. 2, Zhongshan N. Rd., Taipei, Taiwan (R.O.C) 14.Securities will continue to be purchased even after the no.of offeree securities has reached a predetermined no.or percentage, or any other purchase conditions: (1) If the number of effective tendered shares does not reach the Max Quantity of Shares but reaches the minimum acceptance threshold of 13,522,000 shares, representing around 45.00% of the total issued shares of the Target, the conditions of the Tender Offer will be deemed fulfilled. When all conditions of the Tender Offer are fulfilled (the number of effective tendered shares reaches the Minimum Quantity of Shares) and the tender offeror does not suspend the Tender Offer under the relevant laws, the tender offeror will acquire the shares of the Target to the extent not exceeding the Maximum Quantity of Shares. Once the number of effective tendered shares exceeds the Maximum Quantity of Shares, the tender offeror will acquire the shares on a pro rata basis according to the following calculation method. The above calculation methods are explained as follows: (1) Offeree who sell less than 1,000 shares will not be accepted. (2) If the number of shares to be sold exceeds 1,000 shares (inclusive), they shall be allocated in proportion to the number of marketable securities effectively sold by each offeree until 1,000 shares are purchased. If there is still a surplus, the tender offeror will purchase in random order. Therefore, there is a risk that all or only part of the tendered shares cannot be sold by the offeree. The formula for the aforementioned ratio is as follows: Maximum Quantity of Shares / Quantity of Tendered Shares (2) Please refer to the tender offer prospectus for other acquisition conditions. 15.Manner of handling situation when the no.of offeree securities falls short of, or exceeds, a predetermined purchase quantity: (1) If the Minimum Quantity of Shares is not met in the Tender Offer or the relevant regulatory approval is not obtained, the Tender Offer will be cancelled, and Taishin Securities Co., Limited will return the unpurchased shares to the offerees' TDCC account from Taishin Securities Co., Limited's Tender Offer Special TDCC Account (Account Number：8150-2055882) on the first business day after the expiration day of the tender offer period (or the extended tender offer period, as the case may be). (2) If the Minimum Quantity of Shares is met (which is 13,522,000 shares, representing around 45.00% of the total issued shares of the Target, the quantity conditions of the Tender Offer will be deemed fulfilled. When all conditions of the Tender Offer are fulfilled (the number of effective tendered shares reaches the Minimum Quantity of Shares) and the tender offeror does not suspend the Tender Offer under the relevant laws, the tender offeror will acquire the shares of the Target to the extent not exceeding the Maximum Quantity of Shares. Once the number of effective tendered shares exceeds the Maximum Quantity of Shares, the tender offeror will acquire the shares on a pro rata basis. For the portion exceeding the Maximum Quantity of Shares, Taishin Securities Co., Limited will return the unpurchased shares to the offerees' TDCC account from Taishin Securities' Tender Offer Special TDCC Account (Account Number： 8150-2055882) on the first business day after the expiration day of the tender offer period (or the extended tender offer period, as the case may be). 16.Does the matter involve the Investment Commission, Ministry of Economic Affairs? (applicable when overseas Chinese or foreign nationals purchase securities offered by a public company from the Republic of China; if so, please specify one of the following concerning the case: "submitted, not yet approved" or "approved"):No 17.Does the matter involve the Fair Trade Commission (enterprise merger; if so, please specify one of the following concerning the case: "submitted, not yet effective" or "effective"):No 18.The public tender offer application letter shall be examined by an attorney who shall then issue a legal opinion.If the public tender offer must be approved by or reported to the FSC or other competent authorities before it can take effect, a legal opinion must also be submitted.(Please disclose the legal opinion in its entirety under "23.Any other matters that need to be specified according to the SFB".): The tender offer application document has been reviewed by the lawyer, Ross Yang of PricewaterhouseCoopers Legal and a legal opinion has been issued by him in accordance with Article 9, Paragraph 2 of Regulations Governing Public Tender Offers for Securities of Public Companies. 19.Evidence of the ability to carry out payment for the public tender offer consideration: The tender offeror has asked Yuanta Commercial Bank Co., Ltd. (Xinzhuang Branch) to issue a performance guarantee that designates the Taishin Securities Co., Limited. as the beneficiary and authorized the tender offer agent to make a direct request for payment of the consideration for the Tender Offer. (Please refer to 27. Other matters stipulated by the Securities and Futures Bureau of the Financial Supervision (2) The Ccompany will ask the performance guarantee letter issued by the financial institution). 20.Where the aforementioned funds have been obtained via loan, please provide a document with the details of the loan, any evidential documents, and the repayment plan: Please refer to the tender offer prospectus. 21.Where securities are used for public tender consideration pursuant to the provisions of the Regulations Governing Tender Offers for Purchase of the Securities of a Public Company, please provide the names and types of said securities, their average prices for the previous three months, and the closing prices, time of acquisition, and cost of acquisition on the day prior to filing of the report; the factors affecting the price of consideration; and factors affecting determination of the price: Not applicable. 22.Information about directors who are stakeholders in the public tender offer (including name of natural person directors or legal person directors and their representatives, relevant details about the interests held by directors or their representatives, the reasons of their participation or absence from discussion, details of recusal from discussion, and reasons of approval or opposition regarding merger resolution):Not applicable. 23.Any other matters that need to be specified according to the SFB: (Please disclose the legal opinion in its entirety and other information as required.): Time: When all conditions of the Tender Offer are fulfilled and the tender offeror or the financial institution who issuing the performance guarantee has completed the remittance on time, Taishin Securities ("Tender Offer Agent") will perform payment of the consideration of the Tender Offer within 5 business days (inclusive) after the expiration day of the tender offer period (or the extended tender offer period, as the case may be). Method: Taishin Securities, the Tender Offer Agent, will pay the consideration by transfer to the bank account of the offeree in the Tender Offer ("Offeree") provided by the TDCC. If there is an error with information of bank account of the Offeree or the remittance cannot be completed due to other reasons, Taishin Securities will mail a check (Payee Names Underlined and Endorsement Transfers Prohibited) to the TDCC or the Offeree's address on the next business day after the confirmation that the remittance cannot be made. The remittance amount/check amount is calculated based on the consideration to the effective tendered shares minus the applicable securities transaction tax, remittance fee/postage, TDCC/dealer's handling fee and other related expenses and shall be rounded down to the nearest dollar (Remainders less than one dollar will be discarded). 24.Types of consideration for mergers and acquisitions and sources of funds: The total amount of consideration to be paid for the Tender Offer is NT$1,117,119,600, of which NT$700,000,000 is paid by the tender offeror with its own funds, and the remaining NT$417,119,600 is financed by the tender offeror from financial institution. 25. Content of the independent expert's report on the reasonableness of the conversion rate, cash or other assets distributed to the shareholder of this merger (1. Including the method, principle, and calculation of determining the purchase price of the Public tender offer and its comparison to the valuation method, cost method and discounted cash flow method of international practice; 2. Comparison of the Target's financial status, profitability and price-earnings ratio with other public companies in the same industry; 3. If the purchase price of the Public tender offer references the appraisal report of an appraiser, then the content and conclusion of the appraisal report should be included; 4. If the acquirer's plans for repayment of financing uses the assets or shares of the acquired company or the surviving company after merger as collateral, then the evaluation of the financial health of the acquired company or the surviving company after merger should be included): After review of the income approach and Method of Market Prices, Method of Comparing Listed Companies and OTC Companies and the Method of Comparable Transactions in market approach of an appraiser's appraisal report by an independent expert, the fair value of the Target on the reference date is between NT$ 66.5 and 78. The tender offer consideration for the Tender Offer is NT$ 72.9, which is in the reasonable price range mentioned above, therefore, it should be reasonable. The suggest value range provided by the expert engaged by the tender offeror: The valuation result is concluded based on the market approach and the income approach: Market approach: The suggested value of the Target's 100% equity value on a controlling, marketable basis ranged from TWD1,957 million to TWD2,344 million, Income approach: The suggested value of the Target's 100% equity value on a controlling, marketable basis ranged from TWD1,997 million to TWD2,354 million, The income approach reflects the Target's and the Company's management view of the future operation of the Target; the market approach reflects the recent market value of the Target. The valuation result is concluded based on the overlapping value range of the two valuation methods. The suggested value of the Target's 100% equity value on a controlling,marketable basis ranged from TWD1,997 million to TWD2,344 million, equivalents to TWD66.5 to TWD78.0 per share. 26. The plan after the merger is completed (including (1) the willingness to continue operating the company's business and the content of the plan. (2) Whether dissolution, delisting, major changes in organization, capital, business plans, finance and production have occurred, or any other material matter that affects the rights and interests of shareholders of the company): (1) the willingness to continue operating the Ccompany's business and the content of the plan Both the tender offeror and the Target are mainly focus on IC design. The Target's main product line is motor control IC for cooling fans, and the tender offeror has also been actively developing this product line for many years. The tender offeror believes that after the completion of this tender offer, both companies will bring complementary benefits, enhance the competitiveness of both companies and create synergy. (2) Whether dissolution, delisting, major changes in organization, capital, business plans, finance and production have occurred, or any other material matter that affects the rights and interests of sharehol ders of the Ccompany: Except as otherwise stated in the tender offer prospectus, there are no other material events affecting the shareholders' interests of the Target so far as the tender offeror is currently aware and expected. 27. Other matters stipulated by the Securities and Futures Bureau of the Financial Supervisory Commission or major matters related to mergers and acquisitions: (1) The legal opinion issued by the lawyer, Ross Yang of PricewaterhouseCoopers Legal: Please refer to the public tender offer prospectus. (2) The performance guarantee that issued by Yuanta Commercial Bank Co., Ltd.: Please refer to the public tender offer prospectus.