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November 21, 2007 |
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STATS CHIPPAC: Plans to Delist Shares from Nasdaq STATS ChipPAC Ltd. intends to voluntarily delist its American Depositary Shares from the Nasdaq Global Select Market, terminate its American Depositary Receipts program with Citibank, N.A., the depositary for the ADSs, and, if and when it becomes eligible to do so, terminate the registration of its ordinary shares and ADSs at the U.S. Securities and Exchange Commission under the U.S. Securities Exchange Act of 1934, as amended. As disclosed in the Schedule 13D filed by Singapore Technologies Semiconductors Pte Ltd and Temasek Holdings Private Limited with the SEC on October 16, 2007, STSPL may seek to cause the company to voluntarily delist from Nasdaq or the Singapore Exchange Securities Trading Limited, or both. STSPL may also seek to cause the Company to deregister under the Exchange Act if it becomes eligible to do so. STSPL and Temasek have been discussing with the company the possible delisting from Nasdaq and the SGX-ST, termination of the company’s ADR program, and deregistration under the Exchange Act. STSPL, a wholly owned subsidiary of Temasek, currently owns approximately 83.0% of the ordinary shares, including ADSs, of the company. STSPL and Temasek also disclosed in their Schedule 13D filing that STSPL intends to continue to seek to acquire additional ordinary shares and ADSs through open market purchases, privately negotiated transactions or otherwise, upon the terms and at prices as STSPL will determine. Furthermore, in accordance with the continuing listing rules of the SGX-ST, if STSPL submits a delisting proposal to the company to seek a voluntary delisting of the company from the SGX-ST, STSPL must offer all holders of outstanding ordinary shares, including ordinary shares represented by ADSs, if any, and outstanding convertible bonds issued by the company a reasonable exit alternative. The Exit Offer customarily provided to shareholders in the circumstances would be a cash offer to all shareholders to acquire their ordinary shares of the company. Any further purchases of ordinary shares and ADSs by STSPL or making the Exit Offer may facilitate the company’s satisfaction of the requirements for deregistration under the Exchange Act. STSPL and Temasek disclosed in their Schedule 13D filing that STSPL intends to propose to the Company to deregister under the Exchange Act if and when it becomes eligible to do so. In anticipation of the foregoing, which are terminate its ADR program, and if and when it becomes eligible to do so, deregister under the Exchange Act. * Delisting from Nasdaq The company intends to file a notification of removal from listing on Nasdaq on Form 25 with the SEC on or about Dec. 21, 2007. The withdrawal of the ADSs from listing on Nasdaq should be effective 10 days after the filing of the notice on Form 25 with the SEC, unless the Form 25 is withdrawn by the Company prior to its effectiveness. Accordingly, the company expects that the last day of trading of its ADSs on Nasdaq will be on or about December 31, 2007. The company reserves the right to delay the filing of the Form 25 or later withdraw the Form 25 filing for any reason prior to its effectiveness. The company has not arranged, nor is it planning to arrange, for the listing of the company’s securities on another U.S. securities exchange or for quotation of the company’s securities on any other quotation medium in the United States. Following the delisting of the company’s ADSs from Nasdaq and the termination of the ADR program, it is possible that an unsponsored ADR program could be established, in which case any such unsponsored ADSs would trade on the over-the-counter market. The company’s ordinary shares will continue to trade on the SGX-ST, unless the company’s listing on the SGX-ST is suspended or withdrawn. * Termination of ADR Program Prior to delisting, ADS holders can elect to sell their ADSs on Nasdaq or they are entitled, upon payment of ADS cancellation fees, to exchange their ADSs with the Depositary for the underlying ordinary shares, subject to the terms and conditions of the deposit agreement for the ADSs. Following the delisting, ADS holders will still be entitled, for a period of time after the termination of the ADR program and upon payment of ADS cancellation fees, to exchange their ADSs for the underlying ordinary shares, subject to the terms and conditions of the deposit agreement for the ADSs. The Deposit Agreement provides that the period of time after termination of the ADR program during which ADSs may be exchanged for the underlying ordinary shares to be six months. The company is in discussions with the Depositary about amending the Deposit Agreement to shorten this period from six months to two months. If the Deposit Agreement is so amended, a notification will be sent to ADS holders setting forth the amendment and the amendment would become effective after the expiration of 30 days after the notice to the ADS holders. At the end of this period, any remaining ordinary shares underlying the ADSs will be sold, the proceeds of sale will be held by the Depositary and the ADSs will represent only the right to receive the cash proceeds of sale of the underlying ordinary shares without interest thereon. A notification will be sent to ADS holders setting forth the termination of the ADR program in due course. * Intention to deregister from Exchange Act The company currently intends to terminate the registration of its ordinary shares and ADSs and reporting obligations under the Exchange Act if and when it becomes eligible to do so. A delisting from Nasdaq does not exempt the Company from its reporting obligations under the Exchange Act. The company must continue to satisfy its reporting obligations under the Exchange Act, including continuing to file its annual report on Form 20-F, as long as it remains registered under the Exchange Act. The company is currently exempt from the SGX-ST Listing Rules on the basis that it is listed on Nasdaq and subject to the reporting obligations under the Exchange Act. The company is seeking clarification, and is awaiting a response, from the SGX- ST on whether the Company would become subject to the SGX-ST Listing Rules when it becomes delisted from Nasdaq or if and when it becomes deregistered and its U.S. reporting obligations are terminated under the Exchange Act. * Rationale for Nasdaq Delisting and Deregistration The company’s board of directors made the decision to delist from Nasdaq, and deregister and terminate the company’s reporting obligations under the Exchange Act based on: -- the completion of STSPL’s tender offer for all outstanding ordinary shares, ADSs and convertible bonds issued by the company in May 2007 and subsequent purchases by STSPL, STSPL became the owner of approximately 83.0% of the issued ordinary shares of the company and the company’s ADS Nasdaq trading volume has declined significantly; and -- the declining trading volume of the company’s ADSs on Nasdaq, the company believes the costs associated with maintaining its Nasdaq listing and continuing with its U.S. reporting obligations outweigh the limited benefits of maintaining its Nasdaq listing and registration under the Exchange Act. * Possible Suspension of or Withdrawal from Listing on SGX-ST Delisting from Nasdaq will not affect the listing status of the company’s ordinary shares on the SGX-ST. However, the SGX-ST may suspend the listing of the company’s ordinary shares on the SGX-ST if STSPL, other substantial shareholders and the company’s directors, together with their respective associates, own in the aggregate more than 90% of the issued ordinary shares. STSPL currently owns approximately 83.0% of the issued ordinary shares of the company. On May 17, 2007, the company received notice that one other shareholder has voting and dispositive control over 5.02% of the issued ordinary shares of the company and dispositive but non-voting control over an additional 1.84% of the issued ordinary shares of the Company. Accordingly, further purchases of ordinary shares and ADSs by STSPL, other substantial shareholders, the company’s directors, or their respective associates may result in the suspension of the listing of the company’s ordinary shares on the SGX-ST. About STATS ChipPAC STATS ChipPAC Ltd is a back-end semiconductor assembly and test company. It provides full-turnkey solutions to semiconductor businesses, including foundries, integrated device manufacturers and fabless companies in the U.S., Europe and Asia. It ranked fourth in the global outsourcing semiconductor assembly and test industry as of end-2006. In fiscal year 2006, packaging revenue accounted for 74% of sales, and test and other revenues the balance. The communications segment accounted for 57% of sales. The company's offices outside the United States are located in Singapore, South Korea, China, Malaysia, Taiwan, Japan, the Netherlands, and United Kingdom. * * * As reported by the Troubled Company Reporter-Asia Pacific on July 30, 2007, Standard & Poor's Ratings Services raised its corporate credit rating on STATS ChipPAC Ltd. to 'BB+' from 'BB'. The outlook is stable. The issue rating on the senior unsecured debt has also been raised to 'BB+' from 'BB'. The ratings have been removed from CreditWatch, where they were placed with positive implications on March 2, 2007. |
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