Taipei,Sept.12,2012(CENS)--By the end of August,PowerChip Semiconductor Corp.'s(PSC's)debt/asset ratio spiked to 102%,making its net value slip below zero and triggering fears that its stock will be delisted from Taiwan's Over-the-Counter market soon.
As of the end of June this year,the company had total asset value of NT$66.6 billion(US$2.2 billion at US$1:NT$30)and total debt of NT$65 billion(US$2.1 billion).At that time,the company still had NT$576 million(US$19.2 million)equivalent of cash.
The company yesterday ascribed the escalating debt/asset ratio mostly to persisting slump of standard DRAM prices.However,the company's executives pointed out the company's operation remains normal.
The company said it will invite fresh capital to lower the ratio and its board of directors has approved an equity placement project aimed at selling six billion shares for cash.Also,the company is planning to liquidate its shares in Rexchip Electronics Inc.and factories to reduce the ratio.
The company has transformed itself into a silicon foundry from a DRAM maker,with over 60%of capacity already shifted to contract manufacturing.Renesas Electronics Inc.has contracted the Taiwanese chipmaker to make LCD screen drive ICs for orders it has won from Apple.
Industry executives estimated that Apple would demand Renesas to shift the contracts to Vanguard International Semiconductor Co.(VIS),which is partly held by foundry giant Taiwan Semiconductor Manufacturing Co.,for fear that PSC would shut down its operation.
