[Featured Stock] DB HiTek Rises 6% on News of Halting Semiconductor Design Division Spin-Off...

[Asia Economy Reporter Kwon Jae-hee] DB HiTek, a semiconductor foundry specialist, is showing strong performance in early trading on the 27th following news that it has halted the review of a physical spin-off of its semiconductor design division.

At 10:31 a.m. on the Korea Exchange, DB HiTek was trading at 40,500 KRW, up 6.72% from the previous trading day.

After market close the previous day, DB HiTek announced, "To strengthen expertise and competitiveness in each business division, we considered various strategic options including the spin-off of the design business, but have decided to halt the ongoing review of the spin-off process."

DB HiTek has independently designed some products such as display driver ICs (DDI) through its brand business division.

Accordingly, the company had been seriously considering the spin-off of the brand business division to enhance semiconductor design expertise and improve management efficiency. However, after news of the spin-off review surfaced in July, opposition arose mainly among some shareholders. It is also believed that the government's regulatory reform requiring parent company shareholders to be allocated a certain amount of shares in the newly established spin-off company during a physical spin-off influenced this decision.

Meanwhile, DB HiTek's stock price fell to 37,750 KRW during trading the previous day, marking a 52-week low.