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Memory chip maker obtains debt rollover from bank creditors

2012/04/13 20:06:41

Taipei, April 13, (CNA) ProMOS Technologies Inc., a localDRAM maker, said Friday that it has obtained approval from itsbank creditors to roll over its massive debt for six months.

In a filing to the Taiwan Stock Exchange, ProMOS said a consortium of bank creditors has agreed to extend the company's NT$57 billion (US$1.93 billion) debt for six months amid the financial difficulties faced by the global DRAM sector due to slowing demand and falling product prices.

The company said it applied to the Industrial Development Bureau under the Ministry of Economic Affairs for the rollover in December.

After the authorities voiced support for the debt extension, ProMOS in February began negotiations with the creditor consortium led by Taiwan Cooperative Bank.

ProMOS's massive debt had already been extended once for six months in the second half of last year. The latest rollover has theend of June as its deadline, and if necessary, the company will have to seek a further rollover in the second half of this year.

Shares of ProMOS have been forced by law to be delisted from the over-the-counter (OTC) market since March 26, since the book value fell into the red at a time when the DRAM maker was suffering heavy losses.

ProMOS's book value stood at minus NT$4.46 per share at the end of the third quarter of last year, down from the minus NT$2.01 per share a quarter earlier. No further information about its book value after the third quarter was immediately available.

According to local securities regulations, once a listed company on the main board or the OTC market registers a book value of below zero, a delisting order is issued by the authorities.

ProMOS shares had been listed on the OTC market since May 1999.

In the first nine months of last year, the firm incurred NT$14.62 billion in net losses, compared with NT$8.28 billion in net losses recorded a year earlier.

(By Jackson Chang and Frances Huang)