MUSX Corp exits semiconductor business

MANILA, Philippines - Publicly-listed MUSX Corp. is exiting the semiconductor production business as it sets it sights on less risky and lower capital intensive business opportunities including real estate, mining and energy.

In a disclosure to the Philippine Stock Exchange, MUSX said its board has concluded the sale of its semiconductor operations to the current management led by Michael Burton, who is chairman and president. The total price consideration amounted to P54 million, including a P19.7 million partial offset for certain obligations to the employee pension trust and P24.3 million in royalty payments for certain products.

 “After careful, diligent, and detailed review of the existing and other business opportunities over the past several months, the board of directors has decided that the semiconductor business of its subsidiaries is too high-risk and too capital intensive for MUSX,” the holding firm said.

The proposed businesses are expected to translate into near -erm profits and enhance its share values, MUSX said.

Under the agreement, the management team will purchase all MUSX share interests in the local semiconductor unit Music Semiconductors Philippines Inc. and its subsidiary, as well foreign subsidiaries Music Semiconductors Inc, Musem Electronic N.V. and Protelcon Inc. However, the intellectual property for the development of its latest chip design Flexharrp shall be assigned back to MUSX pending payment for it.

All employees joining the management buyout have resigned and their resignations are accepted. Burton immediately resigned as chairman and CEO of MUSX but shall remain as president on a temporary hold-over capacity for purposes of the transition between his term and the term of the new management of MUSX and for him to effect his obligations under the management buy-out.

The new board of MUSX now comprises Richard N. Palou who will serve as chairman and CEO, Renato L. Reyes as treasurer and CFO, Ramon Abad Jr., Jose Syjuco Jr. and Leonardo S. Gayao.