By Yu-huay Sun and Tim Culpan
Oct. 16 (Bloomberg) -- Wang Yung-ching, the son of a tea farmer who transformed a small rice store into Taiwan's largest industrial group, has died.
Wang passed away in his sleep in the U.S. yesterday, Formosa Plastics Corp., his flagship company, said in a stock exchange filing today. Wang, who turned 91 in January, was Taiwan's second-richest person with a net worth of $6.8 billion.
Taipei-born Wang started selling rice in 1932 as his first business before founding Formosa Plastics Corp., a PVC maker, in 1954. The company expanded into Formosa Plastics Group, Taiwan's biggest diversified industrial company.
Known as the ``God of Management'' in Taiwan -- echoing Japan's honorific for Konosuke Matsushita, founder of Matsushita Electric Industrial Co. -- Wang hadn't attended a shareholder meeting since 2002. He stepped down as chairman of the group's major units in 2006. The parent company is now run by a seven-person executive board headed by nephew William Wong and daughter Susan Wang.
``He left behind him a petrochemical kingdom,'' said Chen Ting-ko, a management professor at Taipei's Tamkang University and a former Formosa executive, who has known Wang for 35 years. ``It's like a dragon, which can live in the waters, on the ground and in the sky.''
Oil to Semiconductors
Formosa Plastics is the parent of at least 40 companies and organizations. Subsidiary Formosa Petrochemical Corp. is Taiwan's only publicly-listed oil refiner. Formosa Plastics Corp. is the island's biggest maker of polyvinyl chloride, or PVC. Nan Ya Plastics Corp. is the world's largest processor of plastics for pipes and imitation leather.
Wang had traveled to the U.S. on Oct. 11 to check on the company's operations, Formosa Plastics Corp. said.
With factories in China, Indonesia, Taiwan, the U.S. and Vietnam, Formosa's products range from semiconductors, textiles, to detergents.
Born in Hsintien township outside Taipei, Wang borrowed money when he was 15 to open the rice store.
He won customers by offering services such as home deliveries, earning enough to buy his first piece of land. At 26 he started a lumber business, which blossomed after World War II as construction boomed.
In 1954, Wang switched focus, using his $500,000 fortune to set up Formosa Plastics, according to ``The History of Wang Yung-ching's Struggle'' by Kuo Tai (Yuan-Liou Publishing Co., 1985). He saw the potential of PVC, which is used in flooring and pipes.
Taiwan's Core Value
``Having earned his fortune from scratch, stayed clear- headed after becoming rich, and been forward-looking in ideas and lived a simple life, Chairman Wang represented Taiwan's core value,'' Ma Ying-jeou, the island's president, said in a statement today.
Ma had run the 5000 meter race with Wang in Formosa Plastics Group's athletic meetings and admired Wang's ``determination,'' according to the statement.
Ma ``was impressed'' to be invited to have oysters and noodles, a Taiwanese dish, with Wang two years ago after the group's annual gathering, it said.
Three of the biggest 10 companies on the Taiwan Stock Exchange are members of the Formosa Plastic Group.
``The group's operation should see little impact from Wang's death, since he ceded his power to a professional management team a few years ago,'' said Robyn Hsu, who helps oversee $4.9 billion of funds at Capital Investment Trust Corp. in Taipei. Hsu doesn't own Formosa stocks. ``His companies have operated soundly under a peaceful power transfer.''
Company Shares
Formosa Petrochemical fell 3.4 percent to NT$70.5. Nan Ya Plastics dropped 3.5 percent to NT$44.6, while Formosa Plastics Corp. declined 3.3 percent to NT$52.1. The benchmark Taiex index slumped 3.3 percent.
The shares have tumbled more than 30 percent in the past year, tracking declines in global share markets, as a credit crisis grips economies and threatens a worldwide recession.
Taiwan's richest man is Tsai Hong-tu, chairman of Cathay Financial Holding Co., with a net worth of $8.5 billion, according to Forbes magazine.
To contact the reporters on this story: Yu-huay Sun in Taipei at ysun7@bloomberg.net; Tim Culpan in Taipei at tculpan1@bloomberg.net.
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