Strong demand for Chartered Semiconductor's rights issue

Chartered Semiconductor Manufacturing has become the latest Asian company to successfully raise fresh equity capital from a rights issue, allowing it to cover its maturing debt obligations and fund future capital expenditure, among other things.

The Singapore-based chip maker said on Thursday that its S$464 million ($300 million) offer was 144% subscribed, including excess applications. This means that Temasek, Chartered's controlling shareholder, will buy only its proportional entitlement and that its stake in the company will remain unchanged at 59.4%.

It also means that none of the rights issues in Asia year-to-date have had to put their underwriting commitments to the test, as they have all been fully subscribed by existing shareholders or by investors buying rights in the market. HSBC's gigantic $17.7 billion rights offering, which was completed earlier this month, was only 96.6% subscribed, but the remaining shares were placed by the arrangers as a rump position.