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Chartered performs $300 million rights issue whip-round
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Chartered Semiconductor has bowed to the economic pressure by announcing that it is tro perform a rights issue with the hope of raising $300 million to strengthen its finances. Offering existing shareholders 27 shares at S$0.07 apiece for every 10 shares held, the news is bolstered by the company’s Singaporean investor and majority owner Temasek acting as standby purchaser for up to 90% of the share issue, including its pro-rata entitlement.
Citi, Deutsche Bank and Morgan Stanley will act as joint lead managers and will fully underwrite the offering. The anticipated outcome of this rights offering will be a stronger company from a position of capital as well as providing liquidity to help manage the company’s indebtedness and future capital expenditures.
Following on from this news, Chartered has said in a separate press release that it expects a net loss of around $127 million for the current quarter compared to an estimated loss of $147 million prior to the rights offering being announced.