June 9, 2009 / 10:08 AM / 9 years ago

UPDATE 1-ProMOS says seeking partners, business opportunities

* Seeking new partners, other semiconductor businesses

* Stock jumps 6.1 pct before news, bucking main board decline

(Adds quotes and analyst comments)

By Baker Li

TAIPEI, June 9 (Reuters) - Struggling ProMOS 5387.TWO, Taiwan’s third-largest DRAM memory chipmaker, on Tuesday said it is looking for strategic partners for new business opportunities, including making other semiconductor products.

“We are in discussions with some local and foreign companies for possible cooperation. There might be some different business styles,” ProMOS Vice-President Ben Tseng told Reuters.

“There are possibilities aside from memory (chip) products, but it will still be in the semiconductor sector.”

Tseng confirmed that the companies included other DRAM makers, but he declined to identify them.

ProMOS Technologies is one of many Taiwan companies struggling in the face of the worst-ever downturn for DRAM memory chips. In April, the Taiwan government announced the formation of a new DRAM company, attempting to reorganise the industry to give it long-term viability.

    ProMOS has secured a T$2.98 billion ($91 million) loan from a local banking consortium, which the cash-strapped company had been expecting for months to be used to help pay off its convertible bonds.

    ProMOS’ comments came after the Taipei stock market closed on Tuesday.

    ProMOS shares advanced 6.12 percent to their daily limit, against the main TAIEX's .TWII 3.22 percent drop.

    While ProMOS declined to give specifics on its plans, Sinopac Securities analyst Sophie Chuang said ProMOS could diversify into manufacturing some lower-end logic chips or beef up its business in making CMOS image sensors for consumer gadgets, which have fatter margins than commodity DRAM chips for PCs.

    “To be honest, the company will still struggle even though it tries to branch out into new businesses,” Chuang said. “Chip prices have rebounded recently, but I‘m afraid that oversupply will emerge again after some companies ramp up production.”

    Editing by Ken Wills and Chris Lewis

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