Taiwan's telecoms regulator has seen no reason to object to a merger between Vibo Telecom and Taiwan Star Telecom Corp., the Taipei Times reports.
Spokesperson for the National Communications Commission, Yu Hsiao-cheng, said that Vibo provides third-generation (3G) telecom services, whereas Taiwan Star became a fourth-generation (4G) telecom operator this year, so it would not stifle competition.
Yu said that as direct funding from foreign investors would account for less than 1% of total shares after the merger, whereas indirect investment would account for 47.119%, the company has met all that is required of it under the country's Telecommunications Act.
Article 12 of the act says that a chairperson of a telecom company board must be a Taiwanese national.
A further item states that the sum of direct shares held by foreign investors may not exceed 49%, whilst the sum of direct and indirect shares held by foreign investors may not exceed 60%.
Yu revealed that Vibo would be the surviving company, with Taiwan Star ceasing to exist after the merger. However, the company will be renamed Taiwan Star once the fusing of the two companies is complete.
Yu said that the new company must continue to offer 4G services as Taiwan Star did before the merge to protect its current customers. "Vibo has a lot more subscribers than Taiwan Star, because the latter only began providing services this year. The arrangement is to ensure that a majority of existing subscribers will not be affected by the merger," he added.