From DigiTimes: CMC Magnetics board of directors agreed to a fund raising plan to help expand its DVD production capacity.
It will raise up to US$200 million by issuing five-year zero-coupon ECBs (euro convertible bonds) in an expansion that entails an investment of NT$6.7 billion. Deutsche Bank will be the trustee and Citigroup Global Marketing will act as the underwriter.
The continued drop in CD-R OEM prices should stabilize next quarter with prices rebounding in the last quarter, where some smaller and financially unhealthy Taiwanese firms will be forced to exit the market and China’s economic slowdown policies should shut down about half of the CD-R makers there.
CMC plans to begin producing 16x DVD+R/-R in the third quarter and 8.5GB DL (single-sided double-layer) DVD discs in the fourth quarter. CMC chairman Robert Wong commented that the high technological barriers and huge R&D investment needed to produce DL DVD discs should limit the global market to three or four makers.