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  • Semiconductor Parts Distributors to Challenge Taiwan Competitors
  • August 19, 1998 (TAIPEI) -- Arrow Electronics Inc. and Avnet Inc., two U.S.-based distributors of semiconductor parts, bolstered their relationships with three Taiwan agents recently.
    They aim to compete more effectively in the semiconductor and electronic components distribution market in Taiwan.

    Sharp growth in the local semiconductor industry, coupled with the information industry's growing demand for semiconductor parts, has created a market for semiconductor components distribution. Arrow Electronic and Avnet were thus attracted to Taiwan, and made mergers in a blitzkrieg fashion to earn themselves enough footing in the market.

    Arrow Electronic now owns 75 percent and 45 percent of the shares in two local companies, respectively. And Avnet grabbed away 80 percent of the shares in Mercury & Associates' semiconductor distribution branch.

    However, World Peace Corp. and Yusun Industrial Corporation, two major local distributors, said that the threat from Avnet and Arrow is limited because local semiconductor manufacturers are more inclined to cooperate with local distributors due to their efficient handling and better post-sales service.

    K.T. Tseng, executive chairman of Yusun Industrial, indicated that local distributors are very familiar with the operations of the local market.

    Therefore, foreign distributors are hardly a threat in the Taiwan market, despite their shogun-style marketing campaigns and strong financial backings.

    World Peace and Yusun are targeting annual sales at NT$7.5 billion (US$215 million) and NT$5.8 billion, respectively, in 1998, exceeding Avnet and Arrow by a large margin.

    (Commercial Times, Taiwan)

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    Updated: Tue Aug 18 18:46:12 1998 PDT