As second-tier motherboard makers continue to lose money, they are expected to increasingly fall prey to takeovers by investors or be forced out of the market in the second half of the year, as seen by the recent takeover of Soyo Computer by members of the Taiwan-based PC Chips Group, according to sources at the makers.

A number of investors representing China-based “Lung Teng” (transliterated from Chinese) Electronics, a member of the PC Chips Group, recently bought a majority stake of Soyo’s NT$390 million capital expansion plan through a private placement, the sources said.

Soyo completely reshuffled its board of directors and supervisors followed the capital expansion in July, with personnel related to PC Chips taking a majority of seats on the board, according to sources at Soyo.

PC Chips was founded by Johnson Chiang, chairman of Elitegroup Computer Systems (ECS). However, ECS said that the company had nothing to do with Soyo’s takeover.

In addition, Soyo recently told its shareholders that in the near future it plans to expand its product mix to include computer connectors and heat dissipation modules, which happen to be the core products of Lung Teng.

Soyo is expected to register pre-tax losses of NT$120 million, or NT$1.23 per share, in the first half of this year, although the company’s first-half shipments of 300,000 motherboards equaled the full year total from last year, according to a DigiTimes report.

From DigiTimes