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**Aceroassert** · 02-16-2009, 11:45 PM

http://tech.yahoo.com/news/afp/20090...20090216162410

Taiwan banks 'agree' loan for ailing chip maker ProMOS (AFP)

* Posted on Mon Feb 16, 2009 11:22AM EST

TAIPEI (AFP) - A consortium of banks said Monday they have tentatively agreed to provide a new loan of three billion Taiwan dollars (88.23 million US) requested by ailing memory chip maker ProMOS Technologies Inc.

The state Bank of Taiwan, which leads the consortium of eight creditor banks, said "they had reached a tentative agreement to grant a three billion Taiwan dollar loan to ProMOS," -- two billion dollars short of the amount sought by the company.

The agreement requires final approval of the banks' separate boards, the bank said in a statement late Monday night.

Bank of Taiwan itself will lend ProMOS 700 million Taiwan dollars, it said.

The loan, it said, "will be used to redeem its overseas convertible bonds."

ProMOS, a maker of dynamic random access memory (DRAM) chips, was not immediately reachable for comment. The company badly needs the money to meet the possible redemption of 330 million US dollars worth of overseas convertible bonds it issued in 2007.

An unnamed executive at one of the largest creditor banks told Dow Jones Newswires earlier in the day that there would "definitely be a consensus today."

Without the loan, it was feared that ProMOS would not have sufficient funds to pay its bondholders and sustain operations, leading to a possible default.

The memory chip maker has posted almost two years of losses as chip prices tumble amid a supply glut.

Bank of Taiwan chairwoman Susan Chang said earlier in the day that "it would be too late if we don't decide today" because banks need time to arrange the loan.

ProMOS has been in talks with other DRAM makers in Asia including Japan's Elpida Memory Inc. to consolidate amid the industry's worst downturn since 2001.

Taiwanese authorities have said they want to aid the industry but not individual firms.

In the nine months to September, the island's four major DRAM makers jointly booked a record net loss of more than 90 billion Taiwan dollars, with a full-year loss surging to 120 billion Taiwan dollars, figures show.

Industry critics, however, oppose a government bailout of the local sector which they say is uncompetitive and too reliant on overseas companies who supply crucial advanced core technology.

ProMOS first acquired production technology from Germany's Qimonda and since 2005 has used crucial production technologies from South Korea's Hynix.

02-16-2009, 11:45 PM	#2
Aceroassert Join Date Oct 2005 Posts 444 Senior Member	http://tech.yahoo.com/news/afp/20090...20090216162410 Taiwan banks 'agree' loan for ailing chip maker ProMOS (AFP) * Posted on Mon Feb 16, 2009 11:22AM EST TAIPEI (AFP) - A consortium of banks said Monday they have tentatively agreed to provide a new loan of three billion Taiwan dollars (88.23 million US) requested by ailing memory chip maker ProMOS Technologies Inc. The state Bank of Taiwan, which leads the consortium of eight creditor banks, said "they had reached a tentative agreement to grant a three billion Taiwan dollar loan to ProMOS," -- two billion dollars short of the amount sought by the company. The agreement requires final approval of the banks' separate boards, the bank said in a statement late Monday night. Bank of Taiwan itself will lend ProMOS 700 million Taiwan dollars, it said. The loan, it said, "will be used to redeem its overseas convertible bonds." ProMOS, a maker of dynamic random access memory (DRAM) chips, was not immediately reachable for comment. The company badly needs the money to meet the possible redemption of 330 million US dollars worth of overseas convertible bonds it issued in 2007. An unnamed executive at one of the largest creditor banks told Dow Jones Newswires earlier in the day that there would "definitely be a consensus today." Without the loan, it was feared that ProMOS would not have sufficient funds to pay its bondholders and sustain operations, leading to a possible default. The memory chip maker has posted almost two years of losses as chip prices tumble amid a supply glut. Bank of Taiwan chairwoman Susan Chang said earlier in the day that "it would be too late if we don't decide today" because banks need time to arrange the loan. ProMOS has been in talks with other DRAM makers in Asia including Japan's Elpida Memory Inc. to consolidate amid the industry's worst downturn since 2001. Taiwanese authorities have said they want to aid the industry but not individual firms. In the nine months to September, the island's four major DRAM makers jointly booked a record net loss of more than 90 billion Taiwan dollars, with a full-year loss surging to 120 billion Taiwan dollars, figures show. Industry critics, however, oppose a government bailout of the local sector which they say is uncompetitive and too reliant on overseas companies who supply crucial advanced core technology. ProMOS first acquired production technology from Germany's Qimonda and since 2005 has used crucial production technologies from South Korea's Hynix.
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