TAIPEI - Hon Hai (TW:2317) Precision Industry Co., Ltd., widely known as Foxconn (SS:601138), has increased its credit guarantee for several of its subsidiaries by approximately USD 5 billion, as stated in a press release on Monday. The additional endorsements, which serve as credit limit guarantees for the purchase of products from suppliers, are shared among the named subsidiaries and reflect the company's ongoing support for their operations.
The subsidiaries receiving the additional guarantees include Cloud Network Technology Singapore Pte. Ltd., Cloud Network Technology USA Inc., and Ingrasys Technology USA Inc., among others. These companies are primarily held by Hon Hai at an 84.06% stake, with some subsidiaries being wholly owned. The total ceiling on the endorsements/guarantees for each subsidiary is set at 798,164,813 thousand New Taiwan Dollars (NTD).
As of the date of the event, the total amount of endorsements/guarantees has reached 460,567,438 thousand NTD. This amount represents 29% of Hon Hai's net worth according to its latest financial report, staying within the aggregate limit of 1,596,329,625 thousand NTD set for such financial commitments.
The press release also noted that the newly added endorsement guarantee amount is a shared limit among the endorsed companies. The financial statements of the subsidiaries show a combined capital of 92,239,269 thousand NTD and cumulative gains/losses of 120,034,646 thousand NTD.
Hon Hai's endorsement and guarantee obligations are set to last for one year, with automatic renewal unless either party objects. The exchange rates used for the announcement were listed, including USD, RMB, CZK, HKD, and EUR, providing transparency for the financial figures presented.
This strategic move by Hon Hai is part of its financial arrangements to support its subsidiaries' procurement of supplier products. The information is based on a press release statement, and it highlights the company's approach to managing its financial obligations to its subsidiary companies.
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