Gigabyte Technology Co (技嘉科技) yesterday set a conversion price of NT$371.81 (US$11.75) for its five-year overseas convertible bond issue, a 12.5 percent premium from Monday’s closing share price of NT$330.5.
As Gigabyte shares fell 7.72 percent to NT$305 yesterday on profit-taking, the conversion premium rose to 21.9 percent.
Gigabyte is a producer of servers, graphics cards, motherboards, notebook computers and other computer peripherals. Its revenue rose 59.8 percent year-on-year to NT$105.06 billion in the first quarter, a record high.
Photo: AFP
The company is to start issuing the US$500 million zero-interest overseas convertible bonds on Tuesday next week, it said in a regulatory filing.
The convertible bonds are the company’s fifth overseas fundraising this year, as it aims to finance its material purchases for business expansion, Gigabyte said.
The company said the potential share dilution would be about 5.97 percent if investors were to exchange all their five-year bonds for stock, which Gigabyte said would have a limited impact on shareholders’ interests.
Gigabyte on Friday last week upgraded its estimated capital expenditure for this year to between NT$2.5 billion and NT$2.7 billion on strong artificial intelligence (AI) server demand and its global expansion needs. It spent NT$1.48 billion in the first quarter.
The company also reported record net profit in the first quarter, up 69.1 percent year-on-year to NT$5.27 billion, and earnings per share rose to NT$7.86 from NT$4.65 a year earlier.
Gigabyte’s convertible bond issue came a day after NAND controller and storage solutions leader Phison Electronics Corp (群聯電子) announced that it was raising US$800 million through its first overseas convertible bond issue.
Proceeds from the issue would be used to purchase materials to meet the capital requirements driven by the expansion of its global AI ecosystem solution business, Phison said in a regulatory filing.
The five-year, zero-coupon convertible bond issue is split into two tranches — Tranche A and Tranche B — each sized at US$400 million, the company said.
Phison set Tranche A’s conversion price at NT$3,418.75, representing a 25 percent premium over the closing share price of NT$2,735 on Monday, while Tranche B’s conversion price was set at NT$3,555.5, reflecting a 30 percent premium. Phison shares plunged 9.87 percent to NT$2,465 at the close yesterday.
Both tranches are scheduled to be issued on Tuesday next week, Phision said.
The potential share dilution would be 3.33 percent if investors exchange all their five-year bonds for stock, and it would have a limited impact on shareholders’ interests, it said.
The company said the issue was oversubscribed, and both tranches were priced at the most issuer-friendly end of the range, underscoring strong global investors’ confidence in Phison’s market leadership, product portfolio, customer base and long-term growth prospects.
Phision reported that revenue for the first four months of this year surged 208.32 percent year-on-year to NT$61.17 billion. Net profit in the first quarter rose 1,230 percent to NT$15.18 billion, with earnings per share of NT$68.8.
NEW MARKET: The partnership opens up India to the Dutch company, which already has a strong hold in the semiconductor market of South Korea, Taiwan and China ASML Holding NV entered into a partnership agreement with Tata Electronics Pvt Ltd aimed at ramping up India’s goal to develop domestic chip-manufacturing capabilities. The Dutch company’s technology would help power Tata Electronics’ planned 300 millimeter (mm) semiconductor foundry in Gujarat, according to a joint statement from the two companies on Saturday. The signing of a memorandum of understanding coincides with a visit by Indian Prime Minister Narendra Modi to the Netherlands, which is looking to deepen bilateral relations with New Delhi. ASML, whose top customers include Taiwan Semiconductor Manufacturing Co (台積電) and Samsung Electronics Co, makes lithography machines that can print
PORTFOLIO REBALANCING: The adjustments in three global equity indices reflect rising investor appetite for semiconductor and artificial intelligence-related stocks Taiwan’s weighting in major global equity indices compiled by MSCI Inc is to rise modestly following the latest quarterly review, underscoring the market’s expanding role in emerging-market portfolios, as global investors continue to favor the nation’s technology sector. Taiwan’s weighting in the MSCI Emerging Markets Index is to increase by 0.30 percentage points to 23.76 percent, after the changes take effect at the close of the May 29 session. Its weighting in the MSCI All-Country Asia ex-Japan Index is to rise 0.37 percentage points to 27.16 percent, while that in the MSCI All Country World Index is to edge up slightly to
The Hsinchu County Government’s Labor Affairs Department yesterday said that it has received a plan from cosmetics brand Taiwan Shiseido Co (台灣資生堂) detailing mass layoffs at its plant in Hukou Township (湖口). While the labor authorities did not disclose the number of employees to be laid off, Japanese news media earlier in the day reported that the closure of the company’s factory in Hukou would result in 170 employees losing their jobs. Shiseido followed the law by reporting its layoff plan, the department said, adding that authorities would closely monitor negotiations between the management and affected employees and step in if any
Hon Hai Precision Industry Co (鴻海精密) on Tuesday confirmed a cyberattack targeting some of its North American facilities, but said the affected factories were gradually returning to normal. The company, known globally as Foxconn Technology Group (富士康科技集團), said that its cybersecurity team “activated the response mechanism and implemented operational measures to ensure the continuity of production and delivery.” “The affected factories are resuming normal production,” the company said in a statement. Hon Hai had previously described it as a “technical issue,” when news of the cyberattack first surfaced. The confirmation followed media reports of a large-scale information technology system incident that broke out at
RSS