Mon, Aug 15, 2005 - Page 10 News List

Compal raises millions selling bonds

STAFF WRITER , WITH BLOOMBERG

Compal Electronics Inc (仁寶電腦), the world's second-largest notebook-computer maker, raised US$300 million selling bonds convertible into its shares, according to the sale's arranger.

The zero-coupon, five-year bonds can be converted into the Taipei-based company's shares at NT$38.40 each, or a 10.7 percent premium to Compal's closing price of NT$34.7 on Friday, ABN-Amro Rothschild said in the sale's term sheet.

The deal, which was increased from US$220 million, was five times covered.

"Demand was strong because Compal is a name that equity-linked investors are familiar with," said Stephen Taylor, head of equity-linked at ABN-Amro Rothschild in Asia Pacific. There has been "limited" convertible bond sales recently by Taiwanese companies, boosting appetite for the bonds, he said.

Compal posted the first profit increase in six quarters for its second-quarter performance and forecast strong growth next year. The company plans to ship up to 14 million notebook computers next year, an increase of about 20 percent from this year's level, Ray Chen (陳瑞聰), president and chief executive officer, told investors on Aug. 4.

Two out of every three notebook computers manufactured globally are made by Taiwan companies such as Compal and Quanta Computer Inc (廣達電腦), the world's largest laptop maker.

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