It seems like HTC does not intend to “bend the knee” and will remain, at least for the time being, as a independent company in the mobility market. Thus, although the results obtained with the One M9 are not the best possible, No agreement with ASUS is in sight, something that has been discussed lately about possible merger movements.
Context of the rumors and the role of ASUS
Let's do a little history, like We indicate in Android Help a statement from the president of ASUS, Johnny Shih, hinted that there might be something more than an interest in the purchase or merger with HTCThe fact is that these statements have spread like wildfire on the Internet, where there has been much speculation about the possible repercussions that the union of both companies would have. The format was not at all clear, since it could be a purchase, merger or collaboration.
In that same context, it was noted that these words arose in a investors Assembly, and that the matter had been discussed internally. In fact, ASUS executives clarified that, although the topic had been discussed, the company has historically opted for the organic growth, so the real possibilities The risks of a takeover would not be particularly high, according to various agencies.
The scenario of a hostile takeover if HTC's valuation continued to weaken. However, this type of transaction depends largely on the shareholding structure and the will of investors, so the interest of a potential buyer is not enough for it to prosper.
Would a relationship between HTC and ASUS make sense?
The truth is that, at first, it might make some sense for HTC and ASUS to agree on a way of working together in the mobility market, since it would achieve a interesting muscle Each of these companies brings position and knowledge in the world of phones, the former, and tablets, the latter. However, it seems that the possible merger, acquisition, or collaboration, will not occur.
Beyond this, ASUS has made clear its interest in the mobile segment, with catalogues ranging from tablets a smartphones. Even analyst reports projected for ASUS a Smartphone sales growth of up to 89% year-on-year in certain scenarios, a sign of the push they were looking for in telephony. Added to this is their strong prestige among the gaming community On PCs, a brand asset that, while not automatically translated to mobile, adds value if integrated with an appropriate strategy. In the past, ASUS has flirted with sector consolidation by exploring synergies with other players, reinforcing the idea that they are considering scaling up when they fit within their roadmap.
HTC statement
According to a statement from the Taiwanese company, it seems that what Shih said will remain a mere "waffle" and, for the moment, HTC will continue its solo journey with a really important work ahead to position itself in the market, both in the mid-range and high-end segment. So it's pretty clear that they are confident in their capabilities ... or have a better idea than having ASUS.
HTC's statements clearly state that “has not occurred no contact with ASUS regarding the matter under discussion, and is not considered a possible merger with this company”. In other words, at the moment it is very clear that this manufacturer will go his own way and it will be necessary to see what the president of ASUS says, if it is that it comments something on the matter.
This will also have to be seen how they affect the stock price HTC, which is not going through its best moment, but this injection of self-confidence could turn things around in this area. Of course, we'll have to wait and see. what movements does the Taiwanese company carry out, since he has to manage to reverse the situation in which he finds himself, something that he has not achieved with the HTC One M9.
In fact, after forecasts of losses in quarter, HTC shares recorded sharp declines in some sessions, while the purchase rumors They caused specific rebounds that came close to 10%At other times, the titles closed with discreet variations, reflecting a climate of high volatility typical of periods of corporate speculation.
In operational terms, various sources pointed to production adjustments of the HTC One M9 close to 30% faced with a below-expected performance against direct rivals. This weakness of the flagship explains part of the market's concern and why a hypothetical alliance with ASUS has sparked so much interest among analysts.
At the management level, HTC carried out changes in its leadership and, at the time, its management apologized to shareholders for the results, promising the launch of a new flagship phone to strengthen finances. The message of focus and operational discipline fits with the decision to maintain independence from third parties.
As a precedent to its corporate strategy, HTC has already entered into relevant agreements, such as its significant participation in Beats Audio, where it held a significant stake before the founders bought back that percentage to boost new business lines in home and automotive audio. This track record suggests that HTC know the advantages and limits of alliances and strategic investment without losing its identity.
As of today, the most likely scenario is that HTC will continue to advance on its own while ASUS maintains its thesis of organic growth and observes opportunities. The market will continue to pay close attention to the results, the evolution of the catalog, and any signs that reopen the door to specific collaborations; for now, the official refusal It acts as an anchor of reality against the noise of rumors. Source: Reuters.
