SAN JOSE, Calif. - Taiwan's ChipMOS Technologies Inc. will receive approximately $11.6 million in the sale of its idle, non-core assets, including six sets of Advantest T5377 and Advantest T5377S memory test systems, respectively, and a building located in Hsinchu Science Park, Taiwan.
The idle test equipments and building have been sold to third parties unrelated to the Company. Proceeds from the sales will be used to further pay down ChipMOS Taiwan's bank debt, according to the memory assembly and test house.
That deal was previously announced. In a statement, S.J. Cheng, chairman and CEO of ChipMOS, said, "These sales are part of our ongoing goal to enhance asset efficiency and efforts to have our asset profile match our business strategy as we continue to improve our financial position. We are already seeing the benefits of reducing our commodity DRAM. By focusing on higher margin business opportunities, ChipMOS is positioned to recapture its growth momentum."
Earlier this year, ChipMOS entered into a share purchase agreement with Siliconware Precision Industries Co. Ltd. (SPIL) to sell to SPIL's holding of 133,000,000 common shares of its wholly owned subsidiary, with a consideration of approximately NT$1.63 billion ($51.0 million). The purchased shares represent approximately 15.8 percent of the total number of ChipMOS Taiwan's outstanding shares.
ChipMOS also entered into an equipment purchase agreement with SPIL to purchase SPIL's DRAM test and LCD driver assembly and test operation lines with purchase price of approximately NT$1.63 billion ($51.0 million).
But that deal turned south amid a collapse in the DRAM business. In September, the company announced recent efforts to reduce its commodity DRAM exposure and refinement of its niche/mobile DRAM strategic focus.
The excess testers for final testing of commodity DRAM have been disposed of to the market. In Q2, a subsidiary, ThaiLin, sold five DRAM testers and a parcel of unused land, which generated net proceeds for ThaiLin of approximately $10.8 million. ChipMOS recognized approximately $2.1 million gain on asset disposal as other operating income and $10.8 million in cash on the Company's Q2 financial results.
In August, ChipMOS sold eight DRAM testers, ten burn-in ovens, and toolings acquired from the SPIL deal announced on Feb. 26, 2010. The transactions are expected to generate net proceeds for ChipMOS Taiwan of approximately $14.5 million.
In October, ChipMOS announced the expansion of its wafer gold bumping capabilities in Taiwan into 300-mm, gold bumping production. ChipMOS expected facility and equipment setup of its 300-mm gold bumping line to be completed by the end of 2010 and the line will be ready for production at capacity of approximately 4,000 wafers per month on top of the company's current 8-inch/6-inch gold bumping capacities, which are the current mainstream in driver IC manufacturing. By the end of the third quarter of 2011, the 300-mm gold bumping capacity will ramp up to approximately 10,000 wafers per month.
ChipMOS recently said revenue on a US GAAP basis for the third quarter of 2010 was NT$4.717 billion ($151.2 million), an increase of 4.9 percent from NT$4.498 billion ($144.2 million) in the second quarter and an increase of 40.9 percent from NT$3.347 billion ($107.3) million for the same period in 2009.
Net income attributable to ChipMOS on a US GAAP basis for the third quarter of 2010 was NT$51.0 million ($1.6 million), compared to net loss attributable to ChipMOS of NT$49.7 million ($1.6 million) for the second quarter.
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