Hynix Semiconductor Inc creditors approved a 4.9 trillion won (US$4 billion) bailout yesterday, the third in two years, to keep the world's third-largest computer memory-chip maker in business.
The bailout is bad news for Taiwanese DRAM powerhouse Nanya Technology Corp (
Smaller Nanya rivals Promos Technologies Inc (
Creditors plan to swap 1.9 trillion won of debt into equity and extend payment on 3 trillion won of debt, main creditor Korea Exchange Bank said.
Lenders to the chipmaker have decided that keeping it in business and trying to sell it later is the best way for them to recoup the 6.2 trillion won it owes.
Hynix has posted a profit in only one of the last five years as it struggles with high debt and falling chip prices.
"We expect the debt restructuring will revive the company's operations and this will put creditors in a better position to eventually sell the company," Korea Exchange Bank Vice President Hwang Hak-joong said after a creditors' meeting.
Before the debt swap, lenders want Hynix shareholders to agree to reduce the number of shares by accepting one new share for every 21 held. Hynix has yet to set a shareholders' meeting.
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