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STATS ChipPAC Intends to Proceed to Terminate Its Level I ADR Program
| Source: STATS ChipPAC
UNITED STATES--(Marketwire - March 24, 2008) - SINGAPORE - 03/24/2008 - STATS ChipPAC Ltd.
("STATS ChipPAC" or the "Company") (SGX-ST: STATSChP), a leading
independent semiconductor test and advanced packaging service provider,
today announced that it has decided to proceed with the termination of its
American Depositary Receipts ("ADR") program as soon as practicable.
As disclosed in its annual report on Form 20-F for its fiscal year 2007, in
determining the timing of the termination of its ADR program, the Company
had intended to take into consideration the expected timeline for its
proposed capital reduction exercise intended to effect a proposed payout of
up to US$813 million (the "Cash Distribution") to its shareholders.
However, in light of the uncertain timeline for the proposed capital
reduction due to current market conditions, the Company has decided to
proceed with the termination of its ADR program.
The deposit agreement ("Deposit Agreement") for the American Depositary
Shares ("ADSs") provides that ADSs may be exchanged for the underlying
ordinary shares for six months after termination of the ADR program. The
Company is in discussions with the depositary for the ADSs on amending the
Deposit Agreement to shorten this period from six months to 30 days. A
notification will be sent to ADS holders in due course informing them of
the effective date of this amendment and the termination of the Deposit
Agreement. The amendment and the termination will be effective 30 days
after the notice is given to the ADS holders. Thereafter, holders of ADSs
will have 30 days to exchange their ADSs for the underlying shares. At the
end of the exchange period, any remaining ordinary shares underlying the
ADSs will be sold, the proceeds of which will be held by the Depositary and
the ADSs will solely represent the right to receive such proceeds without
interest thereon.
If the books closure date for the Cash Distribution (if effected) occurs
after the termination of the ADR program but during the exchange period,
ADS holders will only be able to receive the Cash Distribution for the
ordinary shares underlying their ADSs if (i) they exchange their ADSs for
the underlying ordinary shares or (ii) at the end of the exchange period,
upon a sale by the depositary of any remaining ordinary shares in the ADR
program and distribution of the net proceeds thereof together with the Cash
Distribution, in each case, subject to the payment of ADS cancellation fees
and cash distribution fees. If ordinary shares remaining in the ADR program
are sold by the depositary after the exchange period expires, but prior to
the books closure date, the distribution by the depositary of the net
proceeds from the sale of such remaining ordinary shares and any other cash
held by it would not include the Cash Distribution (if effected). If,
however, ordinary shares remaining in the ADR program are sold by the
depositary after the exchange period expires and after the books closure
date, the distribution by the depositary of the net proceeds from the sale
of such remaining ordinary shares and any other cash held by it would
include the Cash Distribution (if effected).
About STATS ChipPAC Ltd.
STATS ChipPAC Ltd. ("STATS ChipPAC" or the "Company") (SGX-ST: STATSChP) is
a leading service provider of semiconductor packaging design, assembly,
test and distribution solutions in diverse end market applications
including communications, digital consumer and computing. With global
headquarters in Singapore, STATS ChipPAC has design, research and
development, manufacturing or customer support offices in 10 different
countries. STATS ChipPAC is listed on the Singapore Exchange Securities
Trading Limited ("SGX-ST"). Further information is available at
www.statschippac.com. Information contained in this website does not
constitute a part of this release.
Certain statements in this release, including statements regarding the
proposed capital reduction and Cash Distribution, are forward-looking
statements that involve a number of risks and uncertainties that could
cause actual events or results to differ materially from those described in
this release. Factors that could cause actual results to differ include,
but are not limited to, our ability to obtain debt financing to fund the
Cash Distribution and repay certain outstanding indebtedness (including
redeeming and/or repurchasing our senior notes) on terms and conditions
acceptable to us, obtaining requisite approvals needed for the Capital
Reduction, general business and economic conditions and the state of the
semiconductor industry; level of competition; demand for end-use
applications products such as communications equipment and personal
computers; decisions by customers to discontinue outsourcing of test and
packaging services; our reliance on a small group of principal customers;
our continued success in technological innovations; pricing pressures,
including declines in average selling prices; availability of financing;
prevailing market conditions; our ability to meet the applicable
requirements for the termination of registration under the U.S. Securities
Exchange Act of 1934, as amended; our ability to meet specific conditions
imposed for the continued listing or delisting of our ordinary shares on
the SGX-ST; our substantial level of indebtedness; potential impairment
charges; delays in acquiring or installing new equipment; adverse tax and
other financial consequences if the South Korean taxing authorities do not
agree with our interpretation of the applicable tax laws; our ability to
develop and protect our intellectual property; rescheduling or canceling of
customer orders; changes in products mix; intellectual property rights
disputes and litigation; our capacity utilization; limitations imposed by
our financing arrangements which may limit our ability to maintain and grow
our business; changes in customer order patterns; shortages in supply of
key components; disruption of our operations; loss of key management or
other personnel; defects or malfunctions in our testing equipment or
packages; changes in environmental laws and regulations; exchange rate
fluctuations; regulatory approvals for further investments in our
subsidiaries; majority ownership by Temasek Holdings (Private) Limited
("Temasek") that may result in conflicting interests with Temasek and our
affiliates; unsuccessful acquisitions and investments in other companies
and businesses; labor union problems in South Korea; uncertainties of
conducting business in China and other countries in Asia; natural
calamities and disasters, including outbreaks of epidemics and communicable
diseases; and other risks described from time to time in the Company's SEC
filings, including its annual report on Form 20-F dated March 7, 2008. We
undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise.