【Background】：
1. As disclosed on the Market Observation Post System of the Taiwan Stock Exchange Corp. (TWSE), the company announced on July 7, 2006 that it sold a stake of 18.11% to B company a price of NT$5.23 billion. The company, nevertheless, published significant company news twice earlier respectively on April 18 and June 23 in the same year, dismissing the news report that it had sold stake to the B company business group. Meanwhile, it claimed the news as “only the mass media’s speculation” and said, “The Company has not been involved with the news so far.”
2. According to news report on August 7, 2006, the company signed a memorandum with B company on April 24, 2006 under which the latter agreed to acquire the former’s shares at a price of NT$32.5 per share. But, before signing the memorandum, the company had started to acquire its shares from other shareholders at a price of NT$20 per share with an attempt to earn profits from the price gap.
【Reactive reactions】：
1. Because the company doesn’t offer its shares to the public, the Center, under the current laws and regulations, is unable to purchase its shares to become the Company’s shareholder. With an attempt to protect investors’ interest, the Center wrote to the company’s parent company Eastern Multimedia (a listed company) twice, on July 18 and September 4, 2006, respectively, requiring it to explain the suspicious points during the process of the company’s share acquisition from shareholders. The Center has reported this case to related regulatory agencies.
2. The Center dispatches representatives to attend Eastern Multimedia’s shareholders’ meeting on May 30, 2007; and raising some questions about the case for the Company to answer during the meeting. Afterwards, this case to Taipei Prosecutors Office for investigation on August 13, 2007.
【Follow-ups】：
After reporting this case to the Taipei Prosecutors Office on August 13, 2007, the Center to beginning investigation on this case itself, focused on the suspicious point that the company Chairman Gary Wang and several related persons concealed the news about the company’s attempt to sell the Group’s shares to B company at a price of NT$32.5 per share before it acquired shares from shareholders at a price of NT$20 per share. The Center has reported this case to the board of directors and announced to start to deal with investors’ compensation applications.