Chartered Semiconductor, the Singapore semiconductor manufacturer,ápostponed its secondary share offer due to the massive market volatility in the US and Asian markets. The deal was to sell 15.68% of the fully diluted share capital of the company in a mix of new and old shares. The sale would haveáraised an estimated $1.8 billion. The company is already listed in Singapore and New York and the new shares were due to be sold into those markets onáApril 18.
The deal was postponed after a week of extensive road shows, organized through two teams from the company and their underwriters, Salomon Smith Barney and CSFB. The two teams saw over 100 investors in the US, Europe and Asia and they hope that such an extensive series of investor presentations will enable the deal to quickly recommence when the markets stabilize. The challenge will be to keep the company fresh in investorsÆ minds while the overall markets are seesawing so wildly.
Nevertheless, company officials and their underwriters are positive that the company will appeal to long-term investors given Chartered's strong market position in telecom chip production. With 3G telecoms services about to be launched around the world, demand for new handsets with 3G capabilities and wireless application protocol (WAP) technology should soar. This, in turn, should ensure Chartered's ability to weather any cyclical downturn in lower margin chip prices.
Chartered Semiconductor shares rose S$1.80 in early Singapore trade to S$12 on the back of overnight gains in the US and news that the secondary sale was being postponed. This was on the back of a 15% slide in its Singapore share price on Monday. There is no indication when the company will re-launch the deal.á