Toptec, a South Korean maker of automated machines for production of display panels and semiconductors, denied recent allegations that it had attempted to sell confidential information on technology related to mobile phone screen lamination machines to China.
The company also refuted claims that it had failed to protect company secrets of its biggest buyer, Samsung Display.
Suwon District Prosecutors’ Office on Friday raided the Toptec headquarters in Gumi, North Gyeongsang Province, as the allegations surfaced in the market.
In response, the share price of the Kosdaq-listed manufacturer fell 28.3 percent compared to the previous trading day in closing. The stock price shrank by 54.3 percent from Aug. 7 until Friday.
While admitting the search and seizure had taken place, Lee Jae-hwan, chief executive of Toptec, wrote in a note to its investors Monday that there was a “miscommunication in the business operation with clients.”
“(Toptec) has neither revealed a technology secret nor failed to maintain confidentiality of information entrusted to us,” Lee wrote.
He added the recent plunge in revenue resulted from a lack of new investment by clients -- makers of display panels or semiconductors -- due to unfavorable conditions at home and abroad, including the threat of a US-China trade war. The company has yet to disclose a sales deal.
Lee added the company would consider an additional share buyback for shareholder protection, without elaborating on details. For three months until Friday, the company completed a buyback of 405,679 of its own shares, worth 9.1 billion won.
Following the revelation, shares of Toptec are suffering heightened volatility.
Toptec’s stock price began to rebound Monday, ending 9.4 percent higher than the Friday‘s closing price.
By Son Ji-hyoung