Thu, Oct 04, 2012 - Page 13 News List

ProMOS to lay off 1,360 employees

RESTRUCTURING PLAN:The firm plans to cut about 94 percent of its workforce by the end of the year as part of a court-approved reorganization forced on it by creditors

By Lisa Wang  /  Staff reporter

Debt-ridden DRAM chipmaker ProMOS Technologies Inc (茂德科技) plans to lay off more than 1,300 employees to cope with a major restructuring plan that includes shutting down all its factories, according to a statement released by the administration of Central Taiwan Science Park (中部科學園區) yesterday.

The statement came after the Hsinchu District Court gave the go-ahead to a request from ProMOS’ major creditor banks, Taiwan Cooperative Bank (合作金庫銀行) and Bank of Taiwan (台灣銀行), to launch a restructuring plan.

ProMOS planns to slash 1,360 workers, or about 94 percent of its overall workforce, by the end of this year, according to the statement.

The administration said it had received the workforce adjustment program from the Hsinchu-based chipmaker, which would include 1,200 job cuts at the company’s operations in central Taiwan and 200 job losses in Hsinchu.

The layoffs would pave the way for ProMOS to transform itself into a chip designer from a chip manufacturer, the Chinese-language Liberty Times (the Taipei Times’ sister paper) reported yesterday.

The paper said ProMOS was also seeking to sell a 12-inch factory, the most valuable asset it owns, in central Taiwan to repay bank loans totaling NT$57 billion (US$1.95 billion), with Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) among the potential buyers.

TSMC declined to comment on the report.

ProMOS spokesperson Sophia Wong (翁慧姍) could not be reached for confirmation as of press time.

ProMOS posted a NT$19.55 billion loss last year, bringing the company’s net value to minus- NT$6.38 per share. The stock was delisted from the over-the-counter market after its net value fell into negative territory.

Meanwhile, LED chipmaker Huga Optotech Inc (廣鎵光電) also sent a workforce adjustment notification to the science park administration, following a buyout deal launched by the nation’s top LED chipmaker, Epistar Corp (晶元光電), last month.

The administration declined to reveal the size of the layoff, but said it would help the affected workers to find new jobs and receive severance payments.

As of Wednesday, there were 190 employees on unpaid leave from companies in the nation’s three science parks, an official at the National Science Council said.

Only two firms reported that they had sent workers on unpaid leave, council member Tung Liang-shen (董良生) said.

He said a biotech company in the Hsinchu Science Park (新竹科學園區) reported 92 workers on furlough, while Gloria Solar Co (生耀光電) in the Southern Taiwan Science Park (南部科學園區) said 98 of its employees had agreed to take unpaid leave.

He forecast that there would be no deterioration in the situation, as the sales performance in the three science parks was improving and there were no workers on unpaid leave in the period between July and last month.

Additional reporting by CNA

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