Tower Semiconductor Secures $550 Million Credit Line for Its Fab 2 Project
MIGDAL HAEMEK, Israel--(BUSINESS WIRE)--Jan. 19, 2001--Tower Semiconductor (Nasdaq:TSEM)(TASE:TOWER) announced today the signing of an agreement with two major Israeli banks, Bank Leumi and Bank Hapoalim, to secure $550 million bank credit line for the construction of Tower's new wafer fabrication plant ("Fab 2").
With the banks agreement, Tower has secured $1.1 billion for financing the construction of the new facility, comprised of $300 million equity investments by wafer partners and Israel Corp., a $250 million government grant and the $550 million bank credit line.
With this, Tower has satisfied the conditions for the formal closing procedure of all the agreements towards construction start. This procedure is expected to take a few days
"This agreement completes the last component of the initial financial package. The banks' commitment emphasizes the national importance of the project, and the confidence of the Israeli financial community in the Company," said Dr. Yoav Nissan-Cohen, Tower's Co-Chief Executive Officer.
"We plan to hold the Fab 2 groundbreaking ceremony on January 31st, 2001 in the presence of the President and the Prime Minister of the State of Israel and other esteemed guests."
About Tower's New Fab
Tower plans to construct an advanced fab adjacent to its current facility in Migdal Haemek, Israel. The new fab, referred to as "Fab 2," will employ approximately 1,000 professionals and produce up to 33,000 200-mm wafers per month in geometries of 0.18 micron and below, using advanced CMOS technology from Toshiba. Funding for the project will come from wafer partners, Israel Corp, Israeli government grant, bank loans and Tower's own resources. Wafer partners include SanDisk Corporation (NASDAQ: SNDK), Alliance Semiconductor (NASDAQ: ALSC), QuickLogic Corporation (NASDAQ: QUIK) and Macronix International (NASDAQ MXICY). The Israeli Investment Center recently decided to approve a government grant of $250 million for Fab 2. Tower has already started the detailed design, employee recruitment and technology transfer for Fab 2, and is expecting to begin construction in the next several weeks. |
