TSMC to issue additional NT$18.5 billion in corporate bonds – Focus Taiwan News Channel




Taipei, Dec. 19 (CNA) Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, will issue an additional NT$18.5 billion (US$649 million) in bonds to raise funds to increase capacity.

TSMC’s board approved a plan Friday to issue NT$18.5 billion in unsecured straight corporate bonds in three tranches.

There will be a five-year NT$1.9 billion tranche with a coupon rate of 0.36 percent, a seven-year NT$10.2 billion tranche at 0.41 percent, and a 10-year NT$6.4 billion tranche at 0.45 percent.

The chipmaker said KGI Securities will serve as the lead underwriter for the bond sale.

The move follows several bond issues already made by the company this year.

TSMC issued NT$60 billion in unsecured straight bonds in the first half of the year to help finance an expansion in capacity of its advanced 5 nanometer process, which began commercial production in the second quarter of 2020.

The chipmaker then issued NT$13.9 billion in unsecured straight bonds and US$1 billion in unsecured straight bonds in the second half of the year, and it launched a NT$12 billion green bond issue in early December to promote environmental initiatives.

Analysts said TSMC has relied heavily on bonds for financing this year because of their low cost of interest at a time when central banks are pumping liquidity into their economies and keeping interest rates low.

TSMC’s efforts to increase its production capacity and upgrade its technology process reflect its optimism toward its business prospects.

The company’s 5nm process already accounted for 8 percent of its sales in the third quarter,
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