June 27, 2007 – Yet another private-equity maneuver is being attempted in the semiconductor industry’s final manufacturing segment — this time for Singapore firm United Test and Assembly Center Ltd. (UTAC).

A press release issued by UTAC indicates that Affinity Equity Partners and TPG Capital, under a combined umbrella company “Global A&T Electronics,” would acquire all issued ordinary shares in UTAC for up to US $0.71-$0.77/share in cash — placing a total value of $2.2 billion on the proposed deal. Affinity and TPG claim to have received commitments from UTAC shareholders representing 17.2% of UTAC’s issued share capital.

(The Taiwan Economic News had cited BlackStone Group, KKR, Carlyle Group and Temasek Holdings as reported interested parties, and that UTAC rival Amkor Technology Inc. was also in the crosshairs for a possible deal.)

Local reports suggests that private equity firms are eager to find a successful entry into the chip packaging and testing sector, where a couple of similar blockbuster deals recently have been attempted with questionable success. Back in Nov. 2006, Taiwan packaging house Advanced Semiconductor Engineering was the target of a $5.5 billion buyout proposal from US private equity firm Carlyle Group, seen as a possible move to accelerate the company’s expansion into China. Carlyle abandoned its pursuit this spring after both sides failed to agree on a price. Carlyle later took a stake in a Japanese chip assembly and test house.

And back in April, STATS ChipPAC found itself the target of a takeover attempt by Singapore Technologies Semiconductors Pte. Ltd. (STS), a subsidiary of state-owned holding firm Temasek Holdings and one of the largest shareholders in Singapore foundry Chartered Semiconductor Manufacturing. That deal ended with Temasek acquiring majority ownership, though it failed to acquire >90% of shares it wanted in order to take the company private.