Chi Mei to finance new 6G LCD plant with share sales

Shareholders of Chi Mei Opto-electronics Corp (奇美電子) yesterday approved a plan to sell shares via private placement, raising about NT$22.28 billion (US$699 million), to finance a new plant.

That would represent a premium of 1.06 percent compared with the average share price of NT$31.27 over the past three months, the company said in a filing to the Taiwan Stock Exchange yesterday.

Shares of Chi Mei Optoelectronics, the nation's second-largest maker of flat-panel displays, fell NT$0.15 to close at NT$31.45 yesterday.

Potential buyers

Chi Mei Optoelectronics did not provide details about potential buyers, but its parent company Chi Mei Corp (奇美實業) has been one of the major investors during past private placement issues.

The proceeds will be used to build a sixth-generation (6G) LCD factory in Taiwan, the statement said.

Chi Mei Optoelectronics said on Aug. 10 that it started building a 6G plant that can process 90,000 sheets of glass per month for cutting into 22-inch and 27-inch screens.

The new plant is scheduled to begin mass production in the fourth quarter of next year, the company said.

GDRs, bonds

Earlier this week, Chi Mei Opto-electronics raised US$335 million by issuing new shares in the form of global depositary receipts at a 4 percent to 8 percent discount to its share price in order to fund its production capacity expansion.

Chi Mei Corp also sold US$350 million worth of bonds exchangeable for shares of Chi Mei Optoelectronics.

The conversion price on the five-year notes was NT$37.32 per share, a premium of 20 percent over Chi Mei Optoelectronics' closing share price of NT$31.10 on Wednesday.

The bonds have a put option in January 2009 and a yield-to-put of 0.5 percent.