UMC/AU Optronics exchangeable priced

Huge demand highlights bull run in Asian equities.

UMC attempted to monetize part of its stake in TFT-LCD manufacturer AU Optronics yesterday Tuesday with a $212 million exchangeable via Lehman Brothers and Morgan Stanley. The new deal follows a previous $200 million exchangeable in May 2002, which has yet to be called by the issuer as the sector turned shortly after pricing and the stock plummeted.

This time round, UMC will be hoping it has timed the deal to catch a cyclical peak, while leaving enough room to make sure it actually gets converted straight after the six month call option.

Terms comprise a five-year deal with a zero coupon, negative yield structure. Pricing came in at 103%,...

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