Financially struggling Powerchip Semiconductor Corp (力晶半導體) expected to receive the go-ahead from credit banks to allocate NT$2 billion (US$60.8 million) in loans as early as today to repay its debts, an executive at the nation’s top computer memory chipmaker said yesterday.
The Hsinchu-based chipmaker said a majority of its bondholders had responded positively to the company's tender for repayingUS$158 million in corporate bonds with cash and common shares.
“Bond holders intend to accept the offer,” company spokesman Eric Tan (譚仲民) told a press conference.
Powerchip said earlier this month it would pay bond holders US$400 in cash for every US$1,000 in bonds and convert the remaining US$600 in bonds into common shares based on a lower conversion price, compared with the initial NT$20.17 per share.
“We will need about NT$2 billion to repay our debts. We already obtained bank loans for the payment, but we need final approval from credit banks to use the money,” Powerchip financial executive Eric Lu (盧展雄) said.
“They could give the go-ahead later today [Wednesday] or early tomorrow,” the executive said.
Powerchip said it would release the results today.
To wrap up the deal, the company needs the approval of more than 90 percent of its bond holders.
Powerchip hired Citigroup Global Markets Ltd to negotiate with bond holders regarding the repayment.
The tender offer is subject to the approval of shareholders at the company’s annual general meeting on June 26.
Citigroup helped local computer memory chipmaker ProMOS Technologies Inc (茂德科技) clinch a deal with its overseas bond holders in April.
Shares of Powerchip and the nation’s No. 2 computer memory chipmaker, Nanya Technology Corp (南亞科技), declined 3.04 percent and 6.86 percent to NT$3.83 and NT$4.75 respectively yesterday.
ProMOS shares rallied 6.67 percent to NT$1.12 after the company said it was in talks with at least two potential partners to make memory chips used in PCs.
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