CHANDLER, Arizona -- Amkor Technology Inc., a provider of contract semiconductor assembly and test services, has completed its sale of 20 million shares in Anam Semiconductor Inc. to Dongbu Group at a price of 5700 Korean Won (about $4.64) per share, for a total consideration of 114 billion Won or about $93 million. As a result, Amkor's ownership interest in Anam reduces from 42% to 22% and it effectively leaves the wafer foundry business.
In July Dongbu made a deposit of 57 billion Won, and with the closing of the transaction today (September 30, 2002) Dongbu has made an additional payment of 15 billion Won, Amkor said.
Taken together, the initial proceeds of 72 billion Won is equivalent to approximately $59 million at current exchange rates. The remaining 42 billion Won will be payable in two equal installments under promissory notes due September 2003 and February 2004. The notes will bear interest at 5% per annum and will be secured by ten million shares of ASI common stock, the company added.
Amkor said the proceeds of the transaction would not be used to repay debts but would instead be used for working capital purposes.
The deal was previously put in jeopardy when Texas Instruments' previously a major customer for Anam Semiconductor, announced a close relationship with Chinese foundry Semiconductor Manufacturing International Corp (SMIC) of Shanghai, China. (see August 29 story).The lack of guaranteed orders for Anam from Texas Instruments seemed to undermine the financing of Dongbu's purchase for a time (see August 28 story).
Now with the promissory notes Amkor exits the wafer foundry arena, to concentrate on chip test and assembly. In the late 1990s, Amkor acquired Anam's chip-packaging plants and thereby took a major stake in the company's foundry operations.
"We are pleased to have concluded this agreement, which is an important step in our stated objective of monetizing our interest in ASI to focus on our core assembly and test business," said James Kim, Amkor's chairman and chief executive officer, in a statement. "We believe that using the proceeds to augment our cash resources provides Amkor with additional liquidity at a time when there is continued uncertainty regarding the pace of recovery in the semiconductor industry," he said.