VIA sales stake in S3 Graphics to HTC

VIA acquired S3 Graphics in 2001 with the intention to accelerate integration of graphics capabilities with its processor and chipset products. S3 Graphics became undercapitalized in 2005, and VIA introduced WTI Investment International, Ltd. (WTI) as a new investor to help fund the operations and R&D initiatives. WTI is a private investment company, in which Cher Wang, Chairman of VIA, is a significant shareholder. Under terms of the agreement with HTC, total consideration for all outstanding shares of S3 Graphics will be USD 300 million. Of which, VIA will receive USD 147 million; and WTI will receive USD 153 million. VIA will recognize a capital gain of USD 37 million and paid-in-capital of USD 115 million in this transaction. The proposed transaction has received approvals from the boards of directors of VIA, WTI, and HTC. Subject to regulatory approvals and other customary conditions, the transaction is expected to close before end of 2011.