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Huga signs NT$ 2 bn loan co-led by Hua Nan Commercial Bank

Taiwanese firm Huga has received the loan in order to increase its capacity for LED wafer and chip manufacturing to cope with demand.

Huga Optotech and Hua Nan Commercial Bank have signed a syndication loan agreement by its representatives in Taipei. The deal is valued at NT$ 2 bn.

Founded in 1998, Huga Optotech is a leading manufacturer of light emitting diode (LED) semiconductor devices dedicated to LED chips and wafer production.

The credit line is reserved for funding Huga’'s expansion in Central Taiwan Science Park (CTSP). Six major banks - Hua Nan Commercial Bank, Taiwan Cooperative Bank, Industrial Bank of Taiwan, Mega International Commercial Bank, Chang Hwa Bank, and The Shanghai Commercial & Savings Bank, financed the deal.

The signing ceremony was co-hosted by the chief representatives from both sides; Dennis Chen from Huga and CY Lee from Hua Nan.

The use of the syndication is to pay for capital expenditure on fab. 3 construction in CTSP and machinery equipment. It is expected that fab 3 will become operational in the second half of 2008 and thus gear up more than double its current capacity.

Huga expect that handheld devices, car electronics and flat panel display will create further demand in the LED industry and take the market to next new highs.

The investment and banking community is very positive about the syndication. The positive outlook by industry insiders and solid financial performance of Huga have both contributing to the success of the syndication being closed in two months with over-booking by 20%. In light of Huga's funding needs, the deal was finally closed at NT$ 2 bn.
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