Steve Jobs Resignation Gets Mixed Reactions In Asia Market Trade
August 25 2011 - 1:00AM
Dow Jones News
The resignation of Steve Jobs as chief executive of Apple Inc.
(AAPL) got a mixed reaction in Asia trade Thursday, as shares in
Apple's smartphone competitors rose sharply on hopes that a
leadership change might distract the U.S. company, while some
component suppliers and assemblers fell on concerns about how the
management change might affect their long-term business
prospects.
Apple competes with the likes of HTC Corp. (2498.TW) of Taiwan,
Samsung Electronics Co. (005930.SE), and LG Electronics Inc.
(066570.SE) in the highly competitive smartphone industry. But
Samsung also supplies key components such as chips and displays
that go into Apple's devices and the company's component business
relies heavily on Apple's business. Meanwhile, LG Electronics unit,
LG Display Co. (034220.SE), also supplies displays used in Apple's
popular iPad tablet computer.
HTC shares were recently up 2.4% at NT$758.00, boosted by the
news, while Samsung rose 3% to KRW729,000. LG Electronics shares
were up 3% at KRW56,700.
However, despite the immediate boost in share price, some
analysts are doubtful whether the change at the top of Apple will
give its smartphone competitors much of an edge.
"Apple is a well established company...I believe (Jobs) will
still be involved in key decisions," said Samsung Securities
analyst Birdy Lu. The combination of Jobs and his nominated
successor, Chief Operating Officer Tim Cook, "should help Apple
maintain its competitive edge. I don't think HTC will get much help
from this news."
HTC and Samsung declined to comment on the developments at
Apple. LG Electronics spokesman Ken Hong declined to elaborate on
the potential impact on the company's smartphone business, but
added that LG is confident Apple will continue to succeed.
Shares in Taiwan-based Hon Hai Precision Industry Co. (2317.TW),
which assembles Apple's gadgets at factories in China, were
recently down 1.7% at NT$63.70. Hon Hai said in a statement it
believes Apple will continue to thrive.
"Hon Hai and Apple are long-time partners. We believe our
relationship will get closer in the future in spite of the
management change," it said.
Shares in touch screen supplier Wintek Co. (2384.TW) fell 4.8%
to NT$22.80. Catcher Technology Co. (2474.TW), which makes the
metal casings for Apple's gadgets, were recently off 3.7% at
NT$219. Both companies declined to comment about the potential
impact of Jobs' resignation.
Meanwhile, some analysts said the resignation could be a
negative development for Asian telecom carriers that offer Apple's
iPhone. In Japan, shares in Softbank (9984.TO)--the only carrier of
the iPhone and iPad products--were underperforming the broader
Nikkei index.
"Apple's products fueled Softbank's growth in recent years and
personal ties between (Softbank CEO) Masayoshi Son and Steve Jobs
may have played a major role in shaping the relationship between
the two companies," said Tokai Tokyo Research Center analyst Yusuke
Tsunoda.
Tsunoda said there are concerns that Apple could decide to use
multiple carriers in Japan to sell its products as it does in the
U.S., which would be a negative development for Softbank. Softbank
wasn't immediately available for comment.
Earlier, Apple said Jobs submitted his resignation to the board
of directors Wednesday and "strongly recommended" that the board
name Tim Cook as his successor.
-By Jung-Ah Lee, Lorraine Luk and Juro Osawa, Dow Jones
Newswires; 852-2832-2330
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