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Technology Stocks : Micron Only Forum -- Ignore unavailable to you. Want to Upgrade?

To: Skeeter Bug who wrote (45635)	5/6/1999 2:25:00 PM
From: DJBEINO	Read Replies (1) \| Respond to of 53903

Micron wants investigation into Anam's debt restructuring A service of Semiconductor Business News, CMP Media Inc. Story posted 1:30 p.m. EST/10:30 a.m., PST, 5/6/99 By Jack Robertson WASHINGTON -- Micron Technology Inc. asked the U.S. Treasury and Commerce departments on Wednesday to look into the debt restructuring deal of Anam Semiconductor Inc. of Korea to see if it violated the ban on any funding from the International Monetary Fund (IMF) being used to bail out Korean chip makers. Amy Klein, Micron's director of government affairs, said the U.S. company doesn't want the Anam refinancing to set any precedent for debt relief to Korean DRAM rivals on subsidized and non-commercial terms. She said although Anam doesn't directly compete with Micron, its recent restructuring "raises our serious concerns that the Korean government and domestic banks may be starting once again to revert to a policy of non-commercial financing for semiconductor companies in that country." The terms of the Anam refinancing arrangement were released last week by Amkor Technology Inc., West Chester, Pa., which is an investor and partner with Anam in both the Korean firm's large chip assembly and testing operations and its front-end fab making DSPs for Texas Instruments Inc. (see April 29 story). According to Amkor, the finanical relief worked out with Korean creditor banks includes: Converting over a four-year period about $208 million in Anam debt into equity through a combination of Anam common stock, convertible securities and non-interest-bearing loans. Deferring payment of principal on ordinary loans until Dec., 31, 2003, when a new payment schedule witll be determined. No interest would be paid on these loans through Dec. 31, 1999. Deferring payment of pincipal under capital leases until Dec. 31, 1999 and then repyament under a seven-year installment plan after that. Reducing the interest rate to a new, unspecified lower level on Anam's won-denominated bank loans. Maturity of won-denominated debentures would be deferred for another three years. Giving a five-year grace period on Anam's subsidiary debt guarantees and removing interest on these obligations for the five year period. Jeffrey Luth, Amkor's vice president of investor relations, said he believed these were conventional provisions of most refinancing arrangements worked out anywhere in the world. "We certainly don't view this as a bailout. The terms are similar to many other financial workouts," he said. He said he wasn't informed about the IMF funding arrangements with Korean banks, and couldn't comment on whether the Anam Semiconductor workout was related in any way. Steve Appleton, Micron's chairman, told SBN when the chip merger of Hyundai Electronics Industries Co. and LG Semicon Co. was finalized that he was concerned the Korean government and banks might try to grant non-commercial relief to the new semiconductor operation (see April 22 story). The Korean chip combine will start off with a total $8 billion debt, according to a Hyundai spokesman. Appleton said that Boise, Idaho-based Micron will fight any move by Korean creditor banks to bail out the Hyundai-LG merger by converting its massive debt to equity, or other subsidized relief, similar to the Anam refinancing. He said Congress and the White House "are fully aware of the issue" and he believed they would take action if bailout relief was given the chip merger. He cited a U.S. law that requires the Treasury Department to certify that no IMF rescue funds to the Korean banks would allow them to bail out chip makers in that country.