And mind you, heard that 90% of the company is made up of FTrash!
http://sg.us.biz.yahoo.com/bw/090309/20090309005599.html?.v=1
Chartered Announces Rights Offering
Monday March 9, 8:40 am ET <TABLE height=4 cellSpacing=0 cellPadding=0 border=0><TBODY><TR><TD height=4></TD></TR></TBODY></TABLE>27-for-10 rights offering targeted to raise net proceeds of approximately US$300 million (S$464 million)
Principal Terms of the Rights Offering
The rights to purchase new ordinary shares will be priced at S$0.07 (indicative ADS rights price of US$0.45) which represents an approximate 65.9 percent discount to Chartered’s last-traded ordinary share price of S$0.205 per share on March 9, 2009 and an approximate 71.0 percent discount to Chartered’s last ADS closing price of US$1.55 per ADS on March 6, 2009. Pursuant to the rights offering, Chartered expects to issue approximately 6,870 million new ordinary shares (directly or in the form of ADSs).
The offering is fully underwritten by Citi, Deutsche Bank and Morgan Stanley, who are also the joint lead managers of the offering. Chartered’s major shareholder, Singapore Technologies Semiconductors Pte Ltd (ST Semiconductors), a wholly-owned subsidiary of Temasek Holdings (Private) Limited, has undertaken to subscribe for its pro-rata entitlement of approximately 59.4 percent of the offering and committed to the underwriters to act as standby purchaser and purchase up to 90 percent of the offering (which includes its undertaking to Chartered and the underwriters for its pro-rata entitlement). The directors, including the CEO, of Chartered who are eligible to participate in this offering also intend to take up their entitlements under this offering in part or in full.
Ordinary shareholders will be entitled to the rights if they are shareholders as of 5.00 p.m. on March 18, 2009 in Singapore. ADS holders will be entitled to the rights if they are holders as of 5.00 p.m. on March 18, 2009 (ET). The Company will be distributing a prospectus, application forms, provisional allotment letters and/or ADS rights certificates, as well as other accompanying documents, for the rights offering to eligible shareholders and ADS holders. Any eligible shareholder or eligible ADS holder who wishes to subscribe for any ordinary share rights or ADS rights, respectively, should do so in the manner set out in the prospectus and its accompanying documents.
The Company has received in-principal approval from the Singapore Exchange and approval for quotation from NASDAQ for the listing of the rights and the new ordinary shares (including ADSs) issuable pursuant to the rights. The offering is expected to be completed around mid-April 2009. For more details, please read the release announcement filed on SGXNET in Singapore and with the SEC. The release announcement will also be available on Chartered’s web site under the investor relations section.
Rationale for Rights Offering and Use of Proceeds
The crisis in the financial markets and deteriorating economic conditions globally have adversely impacted many industries including the semiconductor and foundry industries. The depth and duration of the downturn and the availability of credit on reasonable terms are uncertain. Hence, Chartered believes that a pro-active and prudent approach to managing its capital resources is critical to its business. The rights offering will strengthen the Company’s capital position, and provide Chartered with additional liquidity to manage its maturing indebtedness, fund planned and future capital expenditures, and for general corporate purposes. The rights offering will also improve Chartered’s debt to equity leverage ratios and further support the Company in executing its technology roadmap as well as long-term strategy of planned growth. Chartered also believes the strengthened capital position will preserve the confidence and commitment of its customer base towards the Company.
As of December 31, 2008, Chartered’s cash balance was US$594.1 million. In addition to its cash on hand, Chartered has unutilized credit facilities of approximately US$1,007.9 million of which US$750 million are credit facilities available for equipment purchase in Fab 7. On the same date, Chartered had obligations totaling US$2,106.4 million, consisting of US$1,840.5 million in debt and US$265.9 million in the form of convertible redeemable preference shares, which we currently believe are unlikely to be converted into ordinary shares. Shareholder’s equity as of December 31, 2008 was US$1,443.4 million. Accordingly, Chartered’s debt to equity ratio and net debt to equity ratio as of December 31, 2008 were 1.46 and 1.05, respectively. While Chartered believes that its cash on hand, existing working capital, planned use of existing credit facilities, credit terms with its vendors, and projected cash flows from operations will be sufficient to meet its capital and research and development expenditures, debt service obligations, investment and current liquidity needs for at least the next twelve months, the Company has decided to take pro-active steps to manage its capital resources. After giving effect to the estimated net proceeds of the rights offering amounting to approximately US$300 million, Chartered’s adjusted debt to equity and adjusted net debt to equity ratio will be 1.21 and 0.70, respectively.<SUP>1</SUP>
In view of the above and after assessing a number of options, the Company determined that a rights offering represents the most appropriate funding option at this point and is in the interest of all stakeholders. The rights offering provides shareholders with the opportunity to subscribe on a pre-emptive basis for new ordinary shares at a discount of approximately 65.9 percent to the last-traded price of our ordinary shares of S$0.205 per ordinary share on March 9, 2009 and a discount of approximately 71.0 percent to the closing price of our ADSs of US$1.55 per ADS on March 6, 2009.
Share Consolidation
Subsequent to the completion of the rights offering, Chartered intends to consolidate the number of its shares in issue (Share Consolidation), on the basis that every ten existing shares will be consolidated into one share. The Share Consolidation will become effective only if, and after, it is approved by shareholders at an extraordinary general meeting (EGM) expected to take place on April 30, 2009. Accordingly, the Share Consolidation will become effective only after the rights offering has been completed, and the shares offered pursuant to the rights offering are being offered on the basis of holdings of shares prior to the Share Consolidation. Chartered is proposing the Share Consolidation to help reduce certain fixed costs and also to reduce percentage fluctuations or volatility in the trading of the Company’s Shares and ADSs. The Company also would like to lower the risks of the trading price per ADS potentially falling below the NASDAQ requirement of US$1 over a sustained period of time. Further details on the Share Consolidation will be set out in the proxy statement to be issued accompanying the notice calling for the EGM.
Currently, each ADS is represented by ten shares and Chartered intends to maintain this ratio after the Share Consolidation.
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http://sg.us.biz.yahoo.com/bw/090309/20090309005599.html?.v=1
Chartered Announces Rights Offering
Monday March 9, 8:40 am ET <TABLE height=4 cellSpacing=0 cellPadding=0 border=0><TBODY><TR><TD height=4></TD></TR></TBODY></TABLE>27-for-10 rights offering targeted to raise net proceeds of approximately US$300 million (S$464 million)
- <LI class=" bwlistitemmarginbottom">Citi, Deutsche Bank and Morgan Stanley to act as joint lead managers and to fully underwrite the offering <LI class=" bwlistitemmarginbottom">ST Semiconductors, a wholly-owned subsidiary of Temasek Holdings, to subscribe for its pro-rata entitlement of 59.4 percent of offering and act as standby purchaser for up to approximately 90 percent of the offering (including its pro-rata entitlement)
- Webcast conference call today, March 9, 2009 at 9.00 p.m. Singapore time
Principal Terms of the Rights Offering
The rights to purchase new ordinary shares will be priced at S$0.07 (indicative ADS rights price of US$0.45) which represents an approximate 65.9 percent discount to Chartered’s last-traded ordinary share price of S$0.205 per share on March 9, 2009 and an approximate 71.0 percent discount to Chartered’s last ADS closing price of US$1.55 per ADS on March 6, 2009. Pursuant to the rights offering, Chartered expects to issue approximately 6,870 million new ordinary shares (directly or in the form of ADSs).
The offering is fully underwritten by Citi, Deutsche Bank and Morgan Stanley, who are also the joint lead managers of the offering. Chartered’s major shareholder, Singapore Technologies Semiconductors Pte Ltd (ST Semiconductors), a wholly-owned subsidiary of Temasek Holdings (Private) Limited, has undertaken to subscribe for its pro-rata entitlement of approximately 59.4 percent of the offering and committed to the underwriters to act as standby purchaser and purchase up to 90 percent of the offering (which includes its undertaking to Chartered and the underwriters for its pro-rata entitlement). The directors, including the CEO, of Chartered who are eligible to participate in this offering also intend to take up their entitlements under this offering in part or in full.
Ordinary shareholders will be entitled to the rights if they are shareholders as of 5.00 p.m. on March 18, 2009 in Singapore. ADS holders will be entitled to the rights if they are holders as of 5.00 p.m. on March 18, 2009 (ET). The Company will be distributing a prospectus, application forms, provisional allotment letters and/or ADS rights certificates, as well as other accompanying documents, for the rights offering to eligible shareholders and ADS holders. Any eligible shareholder or eligible ADS holder who wishes to subscribe for any ordinary share rights or ADS rights, respectively, should do so in the manner set out in the prospectus and its accompanying documents.
The Company has received in-principal approval from the Singapore Exchange and approval for quotation from NASDAQ for the listing of the rights and the new ordinary shares (including ADSs) issuable pursuant to the rights. The offering is expected to be completed around mid-April 2009. For more details, please read the release announcement filed on SGXNET in Singapore and with the SEC. The release announcement will also be available on Chartered’s web site under the investor relations section.
Rationale for Rights Offering and Use of Proceeds
The crisis in the financial markets and deteriorating economic conditions globally have adversely impacted many industries including the semiconductor and foundry industries. The depth and duration of the downturn and the availability of credit on reasonable terms are uncertain. Hence, Chartered believes that a pro-active and prudent approach to managing its capital resources is critical to its business. The rights offering will strengthen the Company’s capital position, and provide Chartered with additional liquidity to manage its maturing indebtedness, fund planned and future capital expenditures, and for general corporate purposes. The rights offering will also improve Chartered’s debt to equity leverage ratios and further support the Company in executing its technology roadmap as well as long-term strategy of planned growth. Chartered also believes the strengthened capital position will preserve the confidence and commitment of its customer base towards the Company.
As of December 31, 2008, Chartered’s cash balance was US$594.1 million. In addition to its cash on hand, Chartered has unutilized credit facilities of approximately US$1,007.9 million of which US$750 million are credit facilities available for equipment purchase in Fab 7. On the same date, Chartered had obligations totaling US$2,106.4 million, consisting of US$1,840.5 million in debt and US$265.9 million in the form of convertible redeemable preference shares, which we currently believe are unlikely to be converted into ordinary shares. Shareholder’s equity as of December 31, 2008 was US$1,443.4 million. Accordingly, Chartered’s debt to equity ratio and net debt to equity ratio as of December 31, 2008 were 1.46 and 1.05, respectively. While Chartered believes that its cash on hand, existing working capital, planned use of existing credit facilities, credit terms with its vendors, and projected cash flows from operations will be sufficient to meet its capital and research and development expenditures, debt service obligations, investment and current liquidity needs for at least the next twelve months, the Company has decided to take pro-active steps to manage its capital resources. After giving effect to the estimated net proceeds of the rights offering amounting to approximately US$300 million, Chartered’s adjusted debt to equity and adjusted net debt to equity ratio will be 1.21 and 0.70, respectively.<SUP>1</SUP>
In view of the above and after assessing a number of options, the Company determined that a rights offering represents the most appropriate funding option at this point and is in the interest of all stakeholders. The rights offering provides shareholders with the opportunity to subscribe on a pre-emptive basis for new ordinary shares at a discount of approximately 65.9 percent to the last-traded price of our ordinary shares of S$0.205 per ordinary share on March 9, 2009 and a discount of approximately 71.0 percent to the closing price of our ADSs of US$1.55 per ADS on March 6, 2009.
Share Consolidation
Subsequent to the completion of the rights offering, Chartered intends to consolidate the number of its shares in issue (Share Consolidation), on the basis that every ten existing shares will be consolidated into one share. The Share Consolidation will become effective only if, and after, it is approved by shareholders at an extraordinary general meeting (EGM) expected to take place on April 30, 2009. Accordingly, the Share Consolidation will become effective only after the rights offering has been completed, and the shares offered pursuant to the rights offering are being offered on the basis of holdings of shares prior to the Share Consolidation. Chartered is proposing the Share Consolidation to help reduce certain fixed costs and also to reduce percentage fluctuations or volatility in the trading of the Company’s Shares and ADSs. The Company also would like to lower the risks of the trading price per ADS potentially falling below the NASDAQ requirement of US$1 over a sustained period of time. Further details on the Share Consolidation will be set out in the proxy statement to be issued accompanying the notice calling for the EGM.
Currently, each ADS is represented by ten shares and Chartered intends to maintain this ratio after the Share Consolidation.
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