S&P: STATS ChipPAC notes BB+

Standard & Poor's said it assigned a BB+ long-term issue rating to a proposed exchange offer of up to $640 million five-year senior unsecured notes by STATS ChipPAC Ltd.

Investors in the company's existing $600 million notes can exchange them for the new notes.

The agency said it equalized the issue rating with the corporate credit rating on the company.

Some operating subsidiaries of STATS ChipPAC will unconditionally and irrevocably guarantee the proposed notes under the exchange offer.

The ratings reflect the company's exposure to a cyclical semiconductor industry and severe competition, S&P said.

The ratings also consider the risk associated with STATS ChipPAC's high capital spending on advanced equipment to support anticipated customer requirements, the agency said. Customer concentration also is high with the company's top 10 customers accounting for more than 67% of revenues in 2012, S&P said.

Favorable long-term growth prospects of the outsourced semiconductor assembly and testing services industry and STATS ChipPAC's significant financial risk profile offset those weaknesses, the agency added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.