Announces first-ever capital reduction

Feb 19, 2009 10:49 GMT  ·  By

Netbook pioneer ASUSTeK has just announced, through the president of its Asia-Pacific division, that it will be completely phasing out its 8.9-inch Eee PC netbooks for the current year. The PC maker is apparently going to focus on its larger size product portfolio, as it considers that the 10-inch models are becoming the mainstream alternative in the netbook market segment.

 

According to a recent news-article on Digitimes, ASUS is planning to mainly focus on its 10-inch Eee PC lineup, providing netbook enthusiasts with only the 10-inch versions of its extensive netbook portfolio. Apparently, this form factor has become the mainstream specification for this market segment, which is why ASUS will pay more attention to the larger screen size in 2009.

 

ASUS is expecting that, out of its overall Eee PC shipments, for 2009, the 10-inch models will account for 95%, while the rest of 5% will be represented by the company's 7-inch models, sold at various telecom service operators, according to Lin. The plan is meant to allow ASUS to gain a better market position in the face of its main competitor, Acer, which has gained market leadership by focusing mainly on its 8.9-inch Aspire One netbook.

 

In related news, ASUS has recently announced its plans to reduce its capital by buying back 60 million shares, at a share price of between US$0.66 and US$1.38. The process will be carried out from February 19 to April 18, this year, with the company claiming that the shares will account for around 1.41% of the company's overall shares. These will later be voided and the total purchasing volume will not exceed NT$2.8 billion.

 

The move is expected to allow the company to increase the return on equity (ROE) rate, according to its chief financial officer, David Chang.