Nanya Technology Corp (
Taiwan's fourth-largest mem-ory-chip maker by market value plans to sell 300 million shares as global depositary receipts at the end of this year or the beginning of next year, after Nanya's falling share price forced it to lower estimates of how much it could raise in Taiwan, said Executive Vice President Charles Kau (
The company's shares fell NT$1, or 6.9 percent, to NT$13.50, a record.
The share price fell 45 percent in the three months ended June 30.
The company has yet to decide on a manager or set a price for the sale.
Based on yesterday's closing share price of NT$13.50 a share, the sale would raise about NT$4.1 billion (US$117.5 million).
Nanya will also sell 500 million shares in Taiwan for NT$15 each to existing shareholders by the end of August, Kau said. That would raise NT$7.5 billion, 44 percent less than the original plan in May to raise NT$13.5 billion. The company lowered its share sale price once in June.
"Right now, the situation in Taiwan's market makes it very difficult to get enough cash," Kau said.
"That's why we need to go out to get capital."
Nanya plans to raise money to expand capacity at its chipmaking plants and to build a new plant capable of using 300mm wafers, compared with the current 200mm standard.
Bigger wafers lower costs because more chips can be cut from them.
Falling memory-chip prices forced Nanya to alter its fundraising plans and may force a further change if demand for memory chips fails to revive and boost prices in the second half of the year.
"If the situation is the same as it is now, it's hard seeing them succeed with the GDR sale," said Michael Yeh, who manages NT$400 million in Taiwan stocks at United Securities Investment Trust Corp (
"They'll look at market conditions in five months' time and may well delay the sale." The spot-market price of a benchmark PC 100 128 megabit dynamic random access memory chip is about US$1.83, its lowest this year, according to DRAMeXchange.com, the Web site of a memory-chip information clearing house.
Nanya plans to start building its new plant next March if the overseas share sale takes place on schedule. Production is set to begin in 2004.
A delayed sale would leave Nanya lagging further behind rival memory-chip makers such as ProMOS Technologies Inc (
Still, a later start may work to Nanya's advantage if it can catch a revival in chip demand.
``The depreciation costs of the 300mm plants are huge,'' said Yeh. ``The key is to build the plant in time for a market upturn.''
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