Chen Chin-hsing released Anne Alexander, wife of South African defense attach? E.G.M. Alexander, and was whisked away in a police motorcade to an unidentified location.
Mrs. Alexander walked into an ambulance, apparently unhurt, and was taken to a reunion with her husband and children, who were released earlier in the 24-hour drama.
Police had hunted Chen for six months for his role in the kidnapping and murder of a television star's teenage daughter and the murder of a plastic surgeon and two nurses.
The teenager's slaying triggered an outpouring of public anger over rising violent crime and the government's seeming inability to control it.
Chen surrendered after police met his key demand by promising to reinvestigate the involvement of his wife, brother-in-law and two friends in the case. All four were convicted of being his accomplices and sentenced to prison terms. They were expected to stay in custody pending the new investigation.
As soon as the drama ended, Premier Vincent Siew ordered law enforcers to help check the "overflowing illegal arms that have posed the most serious threat to our public security."
In Johannesburg, South African Foreign Affairs Minister Alfred Nzo issued a statement expressing his "great relief" over the family's release and thanking the Taiwan government for its efficiency and commitment to their safety.
The hostage drama began at about 8 p.m. local time Tuesday when Chen followed Alexander from a nearby convenience store and into his home, one of several villas in a walled compound in northern Taipei.
Chen took Alexander's family hostage, later explaining that he targeted foreigners to draw greater attention.
Hundreds of police in bullet-proof vests and helmets lined the roads around the house, rifles at the ready. They tried to storm the home Tuesday night to rescue the hostages, and Alexander and his daughter, Melanie, 22, were injured in the cross fire. Chen allowed police to enter and remove them to a hospital, where officials said they were in stable condition. Alexander, 50, was hit in the right leg and the daughter was hit in the wrist and hip.
Two more hostages -- Alexander's 7-month-old Taiwanese foster child and his daughter, Christine, 12 -- were released Wednesday afternoon.
"He was really nice to me. He didn't want to hurt me," Christine told reporters. She said her father and sister had been shot by accident.
After the initial shootout, police sought a negotiated solution. They brought Chen's wife to the house Wednesday morning to help mediate.
The wife, Chang Su-chen, had been in jail serving a 12-year term.
They later allowed opposition lawmaker Frank Hsieh to enter, and he spent nearly two hours talking with Chen before walking out with Christine.
Taiwanese television stations broadcast live from the scene throughout the drama, and Chen spent several hours on the telephone talking with the stations from inside the Alexander home.
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