Elpida awash with sell orders on planned share issue

TOKYO, Sept 2 (Reuters) - Japan's Elpida Memory Inc 6665.T was untraded and overwhelmed with sell orders after the memory chip maker said it would issue new shares to raise up to 78.5 billion yen ($844 million), which could increase the number of is common shares by 39 percent. [ID:nT83215]

The price for Elpida was indicated at 1,337 yen, down 13 percent from Tuesday's close.

Elpida, Japan's sole maker of PC memory DRAM, aims to use the funds to adopt new technologies and pay back some of its mounting debt after seven straight quarters of losses.

The firm, which is chasing bigger South Korean rivals Samsung Electronics (005930.KS) and Hynix Semiconductor (000660.KS), said it plans to issue up to 55 million new shares, most of which would be sold overseas.

Still, the negative share reaction is unlikely to last for long, according to Goldman Sachs analyst Ikuo Matsuhashi.

"There are positive factors, such as an increased possibility that Elpida will reach the black in the month of September," he wrote in a note to investors. "Attention will shift to DRAM spot prices in shaping Elpida's share price." (Reporting by Mayumi Negishi, Mariko Katsumura; Editing by Chris Gallagher)