Mon, May 12, 2014 - Page 14 News List

Inotera raises GDR sales for business expansion

Staff writer, with CNA

Memorychip maker Inotera Memories Inc (華亞科技) has raised NT$12.6 billion (US$419 million) from sales of global depositary receipts (GDRs) for future business expansion.

However, the company’s shares took a beating in Taipei trading on Friday after Inotera priced its GDRs at a more than 6 percent discount, closing 6.79 percent lower at NT$33.65 on the Taiwan Stock Exchange.

In a statement, the DRAM manufacturing arms of conglomerate Formosa Plastics Group (台塑集團) said it on Thursday priced the 40 million GDRs at US$10.46 per share.

That represented NT$31.5 in each common share and was 6.1 percent lower than Inotera’s average closing price in the past five trading sessions.

Analysts said that Inotera decided to offer the steep discount to secure the support of foreign investors because the size of the GDR sale is big and the company would use the money for 20 nanometer (nm) technology transition and other equipment.

The company’s GDR sale is the first overseas fundraising activity by domoestic DRAM chipmakes in the past five years.

It is also the largest fundraising by Taiwanese firms in foreign markets since January last year.

Inotera said it will start production of memory chips on the advanced 20nm process on a trial basis at the end of the second quarter and begin mass production by the end of the year.

To speed up development of the 20nm process, Inotera said on April 22 that it is to put NT$22 billion into capital expenditure this year, an upward revision of its earlier budget of NT$15 billion.

In the first quarter, the company’s net profit rose 2 percent from the previous quarter to NT$11.25 billion, or earnings per share of NT$1.85, the highest in the company’s history.

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