Elpida Announces Private Placement by Its Consolidated Subsidiaries
TOKYO, JAPAN, March 25, 2009 – Elpida Memory, Inc (Elpida), Japan's leading global supplier of Dynamic Random Access Memory (DRAM), today announced that two of its consolidated subsidiaries, EBS, Inc. and ECM, Inc., have decided at general shareholder meetings held on March 25 to arrange private placements of shares with Elpida and several Elpida business partners (a total of three Japanese companies and two non-Japanese companies).
Details concerning the private placement appear below.
- Reason for offering of private placement by consolidated subsidiaries
The purpose of the private placement by EBS and ECM is to strengthen the financial position of the Elpida group. Several Elpida business partners who have close relationships with Elpida and an understanding of the company's future prospects in the DRAM industry will be subscribers to the placement.
The capital financing acquired through the placement will be included in the net assets section of Elpida's consolidated balance sheet. Along with Elpida's recent announcement that it has made Rexchip a subsidiary, the company expects the increase in net assets to improve its financial position.
Yukio Sakamoto, president and CEO of Elpida, said, "We are grateful to the business partners and others involved in arranging the placement for their understanding and cooperation in helping to make possible significant improvements in the company's financial position." He added that "Elpida will continue to stress increasing corporate value." - Overview of consolidated subsidiaries EBS and ECM
(1) EBS
(2) ECM1) Corporate Name: EBS, Inc. 2) Representative Director: Yukio Sakamoto 3) Headquarters: 2-2-1 Yaesu, Chuo-ku, Tokyo, Japan 4) Established: March 2, 2009 5) Capitalization: 5 million yen 6) Business operations: Outsourced business from Elpida among other business 1) Corporate Name: ECM, Inc. 2) Representative Director: Yukio Sakamoto 3) Headquarters: 2-2-1 Yaesu, Chuo-ku, Tokyo, Japan 4) Established: March 2, 2009 5) Capitalization: 4.5 million yen 6) Business operations: Sales of semiconductor products manufactured by Elpida among other business - Private placement equity financing details
(1) EBS (Series A preferred shares)
(2) ECMNo. of shares issued 61,600 shares Issue amount 500,000 yen per share Capital proceeds 30.8 billion yen (net proceeds) Capitalization amount 15.4 billion yen Payment date March 27, 2009 Allotment Non-Elpida: 61,600 shares
(Common shares)
(Series A preferred shares)No. of shares issued 182 shares Issue amount 500,000 yen per share Capital proceeds 91 million yen Capitalization amount 45.5 million yen Payment date March 27, 2009 Allotment Elpida: 162 shares
Non-Elpida: 20 shares
The subscribers to the placement have agreed to the following conditions concerning the common shares and Series A preferred shares issued by EBS and ECM:No. of shares issued 30,000 shares Issue amount 500,000 yen per share Capital proceeds 15 billion yen Capitalization amount 7.5 billion yen Payment date March 27, 2009 Allotment Non-Elpida: 30,000 shares
(1) The shares will not be conveyed to a third party.
(2) Based on an agreement between Elpida and the non-Elpida subscribers, Elpida will have call options and non-Elpida subscribers will have put options.
(3) Series A preferred shares are entitled to preferential dividends on a non-cumulative basis.
(4) Series A preferred shares have liquidation preferences.
Also, Series A preferred shares issued by EBS and ECM do not have voting rights and rights of conversion to the common shares of Elpida, EBS and ECM. - Elpida's ownership ratio of the consolidated subsidiary common shares following the placement
(1) EBS
100% ownership
(2) ECMPrior to the placement (as of March 25, 2009) After the placement Elpida 100% Elpida 90% Non-Elpida 10% - Impact on business results
The effect of the private placement on Elpida's FY 2008 (ending March 2009) consolidated earnings performance is expected to be minimal.
About Elpida
Elpida Memory, Inc. (Tokyo: 6665) is a leading manufacturer of Dynamic Random Access Memory (DRAM) integrated circuits. The company's design, manufacturing and sales operations are backed by world class technological expertise. Its 300mm manufacturing facilities, consisting of its Hiroshima Plant and a Taiwan-based joint venture, Rexchip Electronics, utilize the most advanced manufacturing technologies available. Elpida's portfolio features such characteristics as high-density, high-speed, low power and small packaging profiles. The company provides DRAM solutions across a wide range of applications, including high-end servers, mobile phones and digital consumer electronics. More information can be found at http://www.elpida.com.
Information in this news release is current as of the timing of the release, but may be revised later without notice.