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Chunghwa Picture Applies for One-year Grace on NT$15 B. Loan

2009/03/10 | By Quincy Liang

Taipei, March 10, 2009 (CENS)--Chunghwa Picture Tubes, Ltd. (CPT), the third-largest thin film transistor-liquid crystal display (TFT-LCD) panel manufacturer in Taiwan, recently applied to Industrial Development Bureau (IDB) of the Ministry of Economic Affairs for a one-year grace on repaying a NT$15 billion (US$441.2 million at US$1: NT$34) syndicated loan.

Industry sources said that CPT is the first local TFT-LCD panel maker to ask for delayed repayment. James Wu, CPT's vice president, pointed out his company, besides asking for help from the government, is also actively negotiating with creditor banks over the loan extension.

According to CPT, the company has cash and cash equivalents totaling about NT$26 billion (US$764.7 million) but repaying NT$15 billion (US$441.2 million) would cause heavy cash-flow pressure. Having qualified as a firm with a sub-1% layoff rate in 2008, CPT has applied for grace under the bailout offered by the IDB.

The panel maker stressed that it is not asking for government's cash injection but delayed repayment, as well as facilitated processing of its request under the governmental policy.

Panel makers have to hold cash, Wu claimed, while the market uncertainties ahead force CPT to prepare for the worst-case scenario to weather survival challenges in the next six months to one year.

Wu complained that local banks are receiving official support without in turn offering prompt and real help to enterprises.