Fri, Mar 29, 2013 - Page 14 News List

TSMC bond sale raises US$1.495bn

By Kevin Chen  /  Staff reporter

Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, yesterday said it raised up to US$1.495 billion through a private placement to fund its operations, according to a company filing to the Taiwan Stock Exchange before the market opened.

The Hsinchu-based chipmaker said in the filing that it had issued new senior unsecured bonds through wholly owned unit TSMC Global Ltd in two tranches — one of US$350 million of bonds carrying a yield of 0.950 percent due on April 3, 2016, and another of US$1.15 billion of bonds with a yield of 1.625 percent due on April 3, 2018.

TSMC said the three-year bonds were offered at a discount of 0.012 percent to par value, while the five-year bonds were issued at a discount of 0.067 percent to par value.

The company said it expected to close the debt offering on Wednesday next week, adding that the new bonds would be unconditionally and irrevocably guaranteed by the company.

TSMC shares closed 0.5 percent lower at NT$100 yesterday in Taipei trading, while the company’s New York-listed American depositary receipts closed 0.59 percent higher at US$17.17 on Wednesday.

The latest fund-raising activity comes as TSMC plans to spend a record-high US$9 billion on new equipment and facilities this year, up from US$8.3 billion last year, to maintain its leading position in the global foundry sector.

TSMC, a dominant “pure-play” foundry with a nearly 50 percent global market share, maintained its third-largest ranking in the world top 25 of semiconductor companies in terms of sales last year, after Intel Corp and Samsung Electronics Co, according to market researcher IC Insights Inc’s latest tallies.

United Microelectronics Corp (UMC, 聯電), the world’s second-largest contract chipmaker, and MediaTek Inc (聯發科), the nation’s biggest handset chip designer, were the other two Taiwanese companies on the top 25 list compiled by the Scottsdale, Arizona-based semiconductor researcher.

UMC retained its 20th position, while MediaTek saw its ranking climb five notches to 21st last year from 26th in 2011, according to IC Insights.

Pure-play foundries and fabless companies were the star performers in the global semiconductor industry last year, IC Insights Inc said in a statement on Wednesday.

“It is interesting to note that the top five semiconductor suppliers all have different business models. Intel being essentially a pure-play IDM, Samsung a vertically integrated IC supplier, TSMC a pure-play foundry, Qualcomm a fabless company and Texas Instruments a fab-lite semiconductor supplier,” the statement said.

Separately, TSMC said on Wednesday it had sold 521 million shares of Chinese chipmaker Semiconductor Manufacturing International Corp (SMIC, 中芯) for HK$244 million (US$31.43 million), according to a filing to the Taiwan Stock Exchange.

TSMC said it made NT$111 million in profits from the share sale.

Following the sale, TSMC holds a 1.3 percent stake in SMIC, according to the filing.

Additional reporting by Lisa Wang

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