The relatively low tax rate in Singapore is drawing Asustek Computer, which is about to reshuffle its own-brand and ODM/OEM businesses, to relocate its sales and marketing operation to the region, according to company sources. Following the announced spin-off of the company's own-brand business, Asustek is considering transferring the role of brand marketing to its Singapore subsidiary, Asus Technology Pte, leaving only R&D work to be performed at the company's Taiwan headquarters.
Many mid- to high-level management executives from marketing business units at Asustek have recently retired only to be rehired on behalf of Asus Technology Pte, the sources revealed. The associated cost of these "retirements" are expected to reflect in Asustek's financial records in 2007, they added.
Official channels from Asustek responded in saying that Asus Technology Pte is expanding its role as a key operational center for overseas sales. But they added in saying that Asus Technology Pte started operations two years ago, implying that Asustek's plans to grow Asus Technology Pte are not new.
Under the spin-off plans for its ODM business into two wholly-owned subsidiaries, Asus Technology Pte is one of the companies that will remain under the original Asustek structure. Industry watchers commented that Asustek's attempt to grow its operation in Singapore is driven by the planned business reshuffle and the tax relief that arises from new employee bonus schemes. Relocating operation centers overseas is not rare in the IT industry, industry watchers commented, citing the spin-off between Acer and Wistron. Acer also established a company in Singapore to draw more funding from the international market.