SMIC adds $600M through bank loans

June 8, 2006 – Chinese flagship foundry Semiconductor Manufacturing International Corp. (SMIC) said that its Shanghai subsidiary has closed a five-year, $600 million secured term loan facility with a consortium of international and Chinese banks.

China Construction Bank acted as the facility and security agent for the facility, which includes participation from ABN AMRO Bank NV, Bank of China (Hong Kong) Ltd., Bank of Communications, the Bank of Tokyo-Mitsubishi UFJ Ltd., China Construction Bank, DBS Bank Ltd., Fubon Bank (Hong Kong) Ltd., Industrial and Commercial Bank of China, and Shanghai Pudong Development Bank. The loan was oversubscribed, receiving total commitments of nearly $850 million, noted SMIC CEO Richard Chang.

SMIC seemingly has had little trouble rounding up investors to support expansion. Just days ago, SMIC’s wholly owned subsidiary in Tianjin entered into a $300 million loan facility (double the proposed amount) with a group of Chinese banks, to help expand its 200mm fab in Tianjin. Back in December, SMIC entered into a long-term credit facility worth as much as 85 million euros (roughly US $100 million), earmarked for purchases of lithography equipment. And a year ago the chipmaker inked a $600 million loan from a group of Chinese banks (also led by China Construction Bank), after trying to obtain a similar loan from the US Export-Import Bank that was stalled due to protest from domestic chipmakers.

In addition to its Tianjin operation, SMIC has three 200mm fabs in Shanghai and a 300mm fab in Beijing.

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