Announcement in Relation to Regulatory Actions by SGX and/or Other Authorities::Modification of the 2014 Utilization Plan of Funds Obtained Through the Sale of New Stocks

Issuer & Securities

Issuer/ Manager
ACER INCORPORATED
Securities
ACER INC US$200M CB170810 - XS0528416315 - 4ISB
Stapled Security
No

Announcement Details

Announcement Title
Announcement in Relation to Regulatory Actions by SGX and/or Other Authorities
Date &Time of Broadcast
06-Aug-2015 19:04:19
Status
New
Announcement Sub Title
Modification of the 2014 Utilization Plan of Funds Obtained Through the Sale of New Stocks
Announcement Reference
SG150806OTHRNY2S
Submitted By (Co./ Ind. Name)
Nancy Hu
Designation
CFO
Effective Date and Time of the event
06/08/2015 19:00:00
Description (Please provide a detailed description of the event in the box below)
1. Date of the board of directors resolution for the change:2015/08/06
2. Dates of effective registration of the original plan:2014/10/21
3. Reason for the change:
Redemption repayment from the put option executed by the ECB
holders in the original plan was implemented in Q2 2015. Due
to the costs is lower than the redemption repayment from the
put option, Acer had been continually purchasing back and
cancelling the convertible bond from the market. The current
amount of the convertible bond has been lessened from
USD103, 800,000 to USD13, 400,000. Therefore, as of the
expiration date of the options (July 27, 2015), only
NTD459,815 thousand of the convertible bonds had been sold
back by the bondholders, and NT D 1,340,185 thousand of the
increased capital remain unspent. For the effective use of
the funds, it is proposed to change the purpose of the funds
from redemption repayment from the put option executed by
the ECB holders to strengthening working capital , which
will be able to effectively save interest of short-term bank
financing expenditure and reduce financial burden.
4. Content of each and every successive past changed plan
for raising of funds before and after change:
Before change:
1.Pay off bank loan: NTD 3.6 billion.
2.Redemption repayment from the put option executed by the
ECB holders: NTD3.516 billion.
After change:
1.Pay off bank loan: NTD 3.6 billion.
2.Redemption repayment from the put option executed by the
ECB holders: NTD 460 million
3.Strengthening working capital: 1.34 billion
5. Anticipated timetable for execution:
1.Pay off bank loan: Q2 and Q4 of 2015
2.Redemption repayment from the put option executed by the
ECB holders: Q3 2015
3.Strengthening working capital: Q3 2015
6. Anticipated completion date:
1.Pay off bank loan: Q2 and Q4 of 2015
2.Redemption repayment from the put option executed by the
ECB holders: Q3 2015
3.Strengthening working capital: Q3 2015
7. Anticipated possible benefits:
1.Pay off bank loan: based on assumed interest rate, it is
expected that NTD 21 million could be saved in 2015, and
NTD 72 million could be saved in the following years.
2.Redemption repayment from the put option executed by the
ECB holders: based on our current average interest rate
which is 2%, it is expected that NTD 3.065 million could
be saved in 2015, and NTD 9.196 million could be saved in
the following years.
3.Strengthening working capital: based on our current average
interest rate which is 2%, it is expected that NTD 8.935
million could be saved in 2015, and NTD 26.804 million could
be save d in the following years.
8. Difference with original anticipated benefits:
1.Redemption repayment from the put option executed by the
ECB holders: NTD 61.122 million could be saved by the new
plan every year.
2.Pay off bank loan: No difference
3.Strengthening working capital: NTD 26.804 million could
be save by the new plan every year.
9. Effect of the current change on shareholder equity:
As a response to changes in the financial planning, ACER
reserves to maintain a stable banking facilities and working
capital. The proposed modification will increase flexibility
and scheduling the use of funds and improve the financial
structure in the long run, there is no significant negative
impact on shareholders interests.
10. Abstract of the original lead underwriter s appraisal opinion:
The main reason for the Company to modify the plan is because
the ECB holders did not sell back their bonds because of the
economic fluctuation. In order to manage the capital more
efficiently and lower the cost, the modifications of the
original plan is necessary and reasonable.
11. Any other matters that need to be specified:N/A