* AU shares hit almost five-month intraday high
* Taiwan govt gives blessing to possible merger
* A merger not likely to come soon-fund manager
(Adds quotes, details)
By Faith Hung
TAIPEI, Feb 24 Innolux Corp, the
world's No.3 flat-panel maker, declined to rule out a potential
merger with smaller rival AU Optronics, but a fund
manager said such a potential merger may not be realized soon.
Terry Gou, chairman of Foxconn Technology Group, which
controls Innolux, met with Taiwan's economics minister, Chang
Chia-juch, over a possible merger with AU, the Economic Daily
reported, citing the minister.
The minister told Gou, whose Foxconn is a major supplier of
Apple Inc iPhone 5s and iPads, the government would be
glad to see such a deal, but will not step in to push for one,
the report said.
"The government is just trying to be a matchmaker," said
Alex Wang, a fund manager of Fuh Hwa Securities Investment
Trust. "Will a merger come through? We don't know. Only the big
bosses of the two companies would know."
Innolux and AU have suffered a series of quarterly losses
due to stiff competition from South Korean rivals and steep
price cuts. A merger would help Taiwan better compete with South
Korea and cut costs of the two companies.
Shares of AU rose 6 percent to their highest intraday level
since early October and Innolux was up 0.1 percent. Both beat
the broader market, which fell 0.5 percent.
"We are not against such a merger...If the government can
offer assistance, it would be good," Innolux spokeswoman Sophia
AU Optronics declined to comment on reports of a potential
merger and told Reuters it had no specific plan for now,
although it was open to industry consolidation.
(Editing by Anne Marie Roantree, Paul Tait and Matt Driskill)