ProMOS sets early tender date for convertibles to coincide with offer expiration

By Jennifer Chiou

New York, March 18 - ProMOS Technologies, Inc. said it once more pushed back the early tender deadline in the offer for its $350 million of zero-coupon convertibles due 2012, this time to coincide with the offer expiration at 9 a.m. ET on March 21.

The early deadline had been extended to 9 a.m. ET on March 17 from 9 a.m. ET on March 2.

On Feb. 19, the company announced a cash tender offer at a substantial discount to par for the convertibles.

The company is offering up to $265 per $1,000 principal amount for the securities.

Holders who tender by the expiration date will now receive $200, up from $100, per $1,000 principal amount. The amount includes the extra $100 per $1,000 that would have only been paid to those who tendered by the early tender deadline.

ProMOS will also pay to holders who tender by the early deadline a success premium of $30 per $1,000 principal amount if the success rate is 82% or $65 per $1,000 for a success rate of 86%. The success rate is defined as the percentage of bonds either tendered or remaining outstanding and not put back to the company under a new put option.

The company's new lenders, a syndicate led by Bank of Taiwan, own $40 million of the bonds and have indicated that they will not tender and will voluntarily revoke their right to exercise the new put option. Their holdings, 11.9% of the total outstanding, will not count toward the success rate.

The new put option gives bondholders the right to put the bonds back at par on May 29 if the tender does not close by April 17.

To be completed, the tender requires that 79% of the outstanding bonds be either tendered or remain outstanding with the new put option not exercised.

By tendering, holders will be deemed to have revoked the right to put the bonds on Feb. 14. ProMOS said 97.4% of the bonds have been put.

Citigroup Global Markets Inc. is the dealer manager (call Pamela Yeung +852 2501 2695 or Timothy Wee +852 2501 2134 or e-mail promos.tender.offer@citi.com).

The Bank of New York Mellon (fax 44 20 7964 6369 / 65 6883 0338 or e-mail gtsaprm@bnymellon.com with copy to gtsapta@bnymellon.com) is information and tender agent.

Announcement of the tender follows redemption requests from holders for $326.92 million of the $335.62 million of the convertibles outstanding.

Funding for the tender will come from a new NT$3 billion syndicated loan facility arranged by Bank of Taiwan and secured against assets with a book value of NT$15 billion.

In a previous press release announcing the planned tender, ProMOS said it has suffered declining revenue and cash flow due to "adverse macroeconomic factors and highly challenging conditions in the global DRAM industry."

Sales were down 36% in the 12 months to Dec. 31 versus the same period in 2007, and ProMOS recorded an operating loss of NT$24.5 billion versus NT$6.2 billion in the year-earlier period.

Cash was NT$0.2 billion at Jan. 31.

ProMOS already commented that it "has exhausted all possible options to secure the required funding to meet the redemption obligation" on its convertibles. It added that it has looked at selling equipment, obtaining additional secured loans and legal means.

ProMOS is a Hsin-chu, Taiwan-based chipmaker.

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