Iphone assembler Hon Hai Precision Industry Co Ltd will buy a 21 percent stake in Siliconware Precision Industries Co Ltd (SPIL), both firms said on Friday, days after another Taiwan-based Apple Inc supplier also said it wanted to buy into the chip packaging firm.

The rivalry over SPIL, the industry’s third-largest packager, comes as companies in the chip industry seek to overcome the technological challenges raised by the Internet of Things, where everyday products are monitored and controlled online.

Chip packaging firms have also been developing technologies for smart wearables, in which chips that power such gadgets are packed into smaller and smaller spaces.

In a joint stock market filing with SPIL, Hon Hai, the world’s largest contract electronics maker, said it would buy the 21 percent stake in SPIL via a share swap. It did not disclose a value for the deal or say when it would close.

Last week, Advanced Semiconductor Engineering Inc (ASE), the world’s largest chip packager and tester, said it would buy up to 25 percent of SPIL stock on the open market. ASE is a key supplier for the Apple Watch.

Executives at ASE could not be reached for comment on the Hon Hai deal.

(Reporting by Michael Gold; Editing by Miral Fahmy)

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