Wed, Feb 04, 2009 - Page 12 News List

ProMOS seeking NT$5bn in loans to repay urgent debts


Debt-ridden computer memory chipmaker ProMOS Technologies Inc (茂德科技) said yesterday it was seeking an additional NT$5 billion (US$148 million) in syndicated loans from local banks to pay debts due next week.

The capital injection could help the Hsinchu-based company solve pressing financial problems. ProMOS must repay roughly US$330 million in corporate bonds due on Feb. 14. The bondholders can exercise a put option to sell the bonds back to the chipmaker by maturity date.

“This is part of our greater efforts to raise funds to repay the corporate bonds,” company spokesman Ben Tseng (曾邦助) said by telephone.

ProMOS will provide manufacturing equipment worth more than NT$10 billion and guarantors as collateral for the loans, Tseng said, confirming a report by the Chinese-language Commercial Times yesterday.

Tseng declined to reveal the names of the guarantors, but Minister of Economic Affairs Yiin Chii-ming (尹啟銘) told a press conference yesterday that two companies had agreed to guarantee the full sum of NT$5 billion.

One of the companies is a chip packaging and testing firm headquartered in the US, Yiin said without elaborating.

The newspaper said ProMOS would secure NT$5 billion in short-term syndicated loans from the Bank of Taiwan and seven other local banks and that ProMOS would be required to repay them within a year based on an initial agreement reached at a second round of talks.

ProMOS said the report was partly speculation.

Tseng declined to comment on whether ProMOS would secure new capital from any other sources to pay its debts.

The chipmaker raised NT$3.39 billion by selling equipment and real estate in December and last month, it said in filings to the Taiwan Stock Exchange.

ProMOS shares jumped 6.83 percent to close at NT$1.72 yesterday.

Shares of local rivals Powerchip Semiconductor Corp (力晶半導體) and Nanya Technology Corp (南亞科技) rose for the second straight trading day by 6.71 percent and 6.16 percent to NT$3.5 and NT$6.38 respectively.

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