SEOUL, South Korea,
Sept. 1, 2020 /PRNewswire/ --
MagnaChip Semiconductor Corporation ("MagnaChip" or the "Company")
(NYSE: MX) today announced that certain of its wholly owned
subsidiaries have completed the previously announced sale of the
Company's Foundry Services Group and the factory in Cheongju ("Fab
4") to Key Foundry Co., Ltd. ("Buyer"), for a purchase price equal
to approximately $350.6 million,
which includes a positive working capital adjustment of
approximately $5.9 million. The
purchase price was paid in a combination of U.S. Dollars in the
amount of $46.5 million and Korean
Won in the amount of approximately KRW 360.6
billion. In addition to the purchase price, Buyer assumed
all severance liabilities relating to the transferred employees,
which have a value of approximately $100
million. Buyer is a wholly owned subsidiary of Magnus
Semiconductor, LLC ("Magnus"), which was established by Alchemist
Capital Partners Korea Co., Ltd. and Credian Partners, Inc. On
April 20, 2020, Magnus assigned, and
Buyer assumed, all rights and obligations of Magnus under the
business transfer agreement relating to this transaction.
The Company intends to use approximately $227.4 million of the net proceeds to fully
redeem all of its outstanding 6.625% Senior Notes due 2021, of
which $224.25 million principal
amount was outstanding as of August 31,
2020.
MagnaChip's Chief Executive Officer, YJ Kim, said: "This
represents a pivotal chapter for MagnaChip as we are transforming
into a streamlined, pure-play standard products company focused on
the attractive growth opportunities in our Display and Power
businesses. We will use a portion of the net proceeds from the sale
to de-lever by paying off $224.25
million of our outstanding debt, eliminating a substantial
portion of our annual interest expense. With sharpened focus and an
improved balance sheet, we are committed to strive for sustainable
and profitable growth."
"The Board of Directors is pleased with the successful
close of the transaction," said Camillo
Martino, Chairman of the Board of MagnaChip. "The company is
positioning for continued future success, enhancing our
shareholders' value."
The Company will host an Analyst day on Thursday, November 12, 2020 at 9:00 AM Eastern Time.
Safe Harbor for Forward-Looking Statements
Information in this release regarding MagnaChip's use of
proceeds from the sale of its Foundry Services Group and Fab 4,
future operations and shareholders' value are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995 that involve risks and uncertainties. All
forward-looking statements included in this release are based upon
information available to MagnaChip as of the date of this release,
which may change, and we assume no obligation to update any such
forward-looking statements. These statements are not guarantees of
future performance and actual results could differ materially from
our current expectations. Factors that could cause or contribute to
such differences include the impact of changes in macroeconomic
and/or general economic conditions, including those caused by or
related to the COVID-19 outbreak, recessions, economic instability
and the outbreak of disease; the impact of competitive products and
pricing; timely design acceptance by our customers; timely
introduction of new products and technologies; ability to ramp new
products into volume production; industry wide shifts in supply and
demand for semiconductor products; industry and/or company
overcapacity; effective and cost efficient utilization of
manufacturing capacity; financial stability in foreign markets and
the impact of foreign exchange rates; unanticipated costs and
expenses or the inability to identify expenses which can be
eliminated; compliance with U.S. and international trade and export
laws and regulations by us and our distributors; the risk that the
redemptions of our Notes are not consummated according to our
current expectations or at all; public health issues, including the
COVID-19 pandemic; other business interruptions that could disrupt
supply or delivery of, or demand for, MagnaChip's products,
including uncertainties regarding the impacts of the COVID-19
pandemic that may result in factory closures, reduced workforces,
scarcity of raw materials and goods produced in infected areas, as
well as reduced consumer and business spending affecting demand for
MagnaChip's products due to government and private sector mandatory
business closures, travel restrictions or the like to prevent the
spread of disease; and other risks detailed from time to time in
MagnaChip's filings with the SEC, including our Form 10-K filed on
February 21, 2020 (including that the
impact of the COVID-19 pandemic may also exacerbate the risks
discussed therein), our Form 10-Q filed on May 11, 2020, our Form 10-Q filed on August 7, 2020 and subsequent registration
statements, amendments or other reports that we may file from time
to time with the Securities and Exchange Commission and/or make
available on our website. MagnaChip assumes no obligation and does
not intend to update the forward-looking statements provided,
whether as a result of new information, future events or
otherwise.
About MagnaChip Semiconductor
MagnaChip is a designer and manufacturer of analog and
mixed-signal semiconductor platform solutions for communications,
IoT, consumer, industrial and automotive applications. The Company
provides a broad range of standard products to customers
worldwide. With more than 40 years of operating history,
MagnaChip owns a portfolio of approximately 1,200 registered
patents and pending applications, and has extensive engineering,
design and manufacturing process expertise. Please visit
www.magnachip.com for more information. Information on or
accessible from MagnaChip's website is not a part of, and is not
incorporated into, this release.
CONTACTS:
United States
(Investor Relations):
So-Yeon
Jeong
Head of Investor
Relations
Tel.
+1-408-712-6151
investor.relations@magnachip.com
|
Korea / Asia
media:
Chankeun
Park
Director of Public
Relations
Tel.
+82-2-6903-5223
chankeun.park@magnachip.com
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/magnachip-completes-sale-of-foundry-services-group-and-fab-4-301121599.html
SOURCE MagnaChip Semiconductor Corporation