Thu, Jul 16, 2009 - Page 11 News List

Powerchip granted new six-month extension on loan

By Kevin Chen  /  STAFF REPORTER

Creditor banks have agreed to extend a loan rollover to Powerchip Semiconductor Corp (力晶) for another six months, a move that will further ease financial pressure on the nation’s largest memory chipmaker.

In a stock exchange filing yesterday, Powerchip said creditor banks led by Mega International Commercial Bank (兆豐國際商銀) agreed to extend the deadline of a syndicated loan to Dec. 30.

It was the second time this year that creditor banks agreed to roll over the more than NT$63 billion (US$1.9 billion) in loans.

In February, the banks granted the cash-strapped chipmaker a grace period until June 30 for payment of its loan principal. During the period, Powerchip only had to pay the monthly interest on the loan.

The new rollover came after the Hsinchu-based firm obtained US$125 million in fresh capital from US-based Kingston Technology Corp and Taiwan’s Powertech Technology Inc (力成) last week.

Late last month, the firm gained investor approval to reset the terms of its US$157.85 million overseas convertible bonds because it did not have enough money for a repayment.

Meanwhile, memory chipmaker Winbond Electronics Corp (華邦) signed a three-year NT$3.7 billion syndicated loan agreement yesterday with nine local banks led by Bank of Taiwan (臺灣銀行) and Chinatrust Commercial Bank (中國信託商銀), the company said in a statement.

The Taichung-based firm will use the new money to refund long-term loan payments and finance the general working capital of the company, Winbond said.

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