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Asia300

Hon Hai shares rise on US investment speculation

Market sees clue in document from meeting between Trump, SoftBank chief

HONG KONG -- Hon Hai Precision Industry rose in Taiwan trading on Wednesday amid speculation that the company may jointly make a large investment in the U.S. with Japan's SoftBank Group.

Shares surged by 1.10 New Taiwan dollars, or 1.33%, to an intraday high of NT$83.40 on the speculation, which arose after the news of Tuesday's meeting between U.S. President-elect Donald Trump and SoftBank Chairman and CEO Masayoshi Son in New York.

Although Son did not elaborate, a page of a document he showed to reporters after the meeting, seen in a photo used in a CNBC news report on Tuesday, featured the logo of Hon Hai -- also known as Foxconn -- alongside SoftBank's, with investment figures of $7 billion and $50 billion, respectively, indicated below.

Along with the rest of the sparse text on the page, this was taken to indicate that Softbank and the major Taiwanese contract electronics maker may have offered to invest the respective amounts over the next four years and that each company expects to generate 50,000 jobs.

According to CNBC's report, "It was unclear what role the company [Hon Hai] would play in the deal." But when Taiwanese media outlets, such as the cnYES.com website, reported what was indicated on the document on Wednesday, many investors took it to mean Hon Hai will be involved.

Apple was recently reported to have sounded out Hon Hai and rival Pegatron on the possibility of relocating their iPhone-related production facilities to the U.S. This was seen as Apple's potential response to Trump's pledge to persuade U.S. companies to repatriate their manufacturing. The latest speculation has also led to conjecture that iPhone production may soon be moved to the U.S., local media reported on Wednesday.

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