Temasek unit accepts JCET's offer for STATS ChipPAC

Singapore

FRIDAY was a busy day for mainboard-listed STATS ChipPAC with the company announcing that its majority shareholder, Singapore Technologies Semiconductors Pte Ltd (STSPL), has accepted a final cash offer from a consortium led by China's Jiangsu Changjiang Electronics Technology Co (JCET) to buy out the company with the intention of taking it private.

It also announced the exit of two senior officials: Dennis Chia, chief financial officer; and Janet Taylor, senior vice-president, general counsel and company secretary. Mr Chia will be leaving on July 3, and Ms Taylor on July 8.

STSPL, which is a wholly owned unit of Temasek Holdings, controls around 83.7 per cent of STATS' shares. JCET-SC (Singapore), the China company's Singapore-based unit is offering 46.577 Singapore cents per share, or S$1.03 billion, as its final price. In late December last year, JCET-SC first made its pre-conditional voluntary general offer for STATS.

Rumours had been swilling around since early 2014 of a possible takeover bid for the company, which is one of the largest providers of advanced semiconductor packaging and test services. In May last year, STATS publicly admitted that there was an "expression of interest" after share prices went up on this speculation.

The company has global manufacturing facilities in South Korea, Singapore, China and Taiwan (which includes its 52 per cent-owned subsidiary, STATS ChipPAC Taiwan Semiconductor Corporation).

JCET is one of the largest Chinese electronics packaging service providers listed on the Shanghai stock exchange. It is ranked sixth in the global semi-conductor packaging and testing industry and first in China in 2014.

As part of the offer agreement, STATS ChipPAC announced a proposed offering of perpetual securities by way of a non-renounceable rights issue to raise gross proceeds of US$200 million. The perpetual securities will be offered to shareholders on the basis of one perpetual security for every 11,011 shares held by shareholders as at the books' closure date. STSPL has, subject to certain conditions, undertaken to subscribe for both its pro rata share of the perpetual securities and all other perpetual securities not subscribed by the other shareholders, up to an aggregate maximum amount of US$200 million.

In a separate announcement, telco major StarHub said that Mr Chia is joining as CFO with effect from July 8. It was not immediately known where Ms Taylor would be going. STATS, in its announcement, had said that she was "looking to pursue other career opportunities".

STATS ChipPAC ended trading on Friday at 51.5 cents, up half a cent.

Additional reporting by Amit Roy Choudhury