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Hynix creditors may meet

Hynix Semiconductor Inc creditors may meet by Friday to discuss the third-largest computer-memory chipmaker's request for a US$5.4 billion bailout, its second rescue in three months, its biggest lender said.

Hynix Chief Executive Park Chong Sup and his advisers Salomon Smith Barney Inc have been meeting creditors since last week to persuade them to swap debt for shares in the company, extend new loans and roll-over credits. Hynix is also seeking to sell more shares to existing shareholders.

The banks are unlikely to make a decision at the meeting which is aimed at checking progress only, said Lee Won Seok, a spokesman for Korea Exchange Bank, Hynix's main creditor bank.

Hynix needs creditors to make a decision quickly as it loses money selling a product for less than the price it costs to make. It is also struggling to keep up repayments on debt that are six times its market value while finding billions of dollars to spend on technology needed to keep up with competitors.

Under the proposal banks are considering, Hynix wants shareholders to buy 1 trillion won (US$772 million) of new shares, creditors to buy 3 trillion won of bonds convertible into its stock and to extend repayment on 2.1 trillion won of debt, it said in a 28-page presentation shown to banks last week.
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