To finance production expansions, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) would issue up to NT$120 billion (US$4.13 billion) in bonds, the company said on Friday.
The world’s largest contract chipmaker is to initially issue a batch of NT$21.1 billion in three unsecured corporate bond tranches: a five-year tranche of NT$4.8 billion with a coupon rate of 0.5 percent, a seven-year tranche of NT$11.4 billion with 0.55 percent and a 10-year tranche of NT$4.9 billion with 0.6 percent, TSMC said.
The plan, approved by a board meeting last month, would increase production capacity through new facilities and equipment upgrades, and pollution prevention measures at its fabs, it said.
Photo: Grace Hung, Taipei Times
Capital Securities Corp (群益證券) would serve as the lead underwriter of the bond sale, TSMC said.
In an investors’ conference held in mid-January, TSMC vice president and chief financial officer Wendell Huang (黃仁昭) said that the company would spend US$25 billion to US$28 billion on capital expenditure this year, a record for the chipmaker.
US-based advisory firm IC Insights said that governments in the US, EU and China would each have to spend at least US$30 billion per year for five years to catch up with TSMC and South Korea’s Samsung Electronics Co.
The combined capital expenditure of TSMC and Samsung is forecast to total at least US$55.5 billion this year, making it unlikely for any other chipmaker to rival them in spending, IC Insights said, adding that the two firms are expected to further widen their technology gaps with their competitors.
However, capacity shortages in the chip industry have over the past few months disrupted production at smartphone makers and automakers.
On Wednesday, Samsung said that its smartphone production in the second quarter could be affected by global chip shortages.
Seoul-based NH Investment and Securities Co said in a note on Thursday that the situation would start improving in the second half of this year, as operations at TSMC fabs in Taiwan and a Samsung fab in Austin, Texas, would return to normal, and new facilities of both companies would assume operations.
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