| dc.description.abstract | The characteristics of IC fabrication business are technology-intensive, large capital needs, product life cycle is short, intense price competition, market wide application areas, the market changes fast and highly risk, strong research and development needs and high level international competition, so manufacturers have invested the greatest human and financial resources on capital expenditures. The international companies are focused on capital expenditures, so the big ones get bigger, but it also create the high capital barriers of the industry. If IC fabrication business cannot keep pace with the times to the technology and products, sooner or later, they will be eliminated by the tide. Hence, the demand for capital expenditures will be stronger than other industries, and it also highlights the importance of financing.
This study is investigated the sources of funds and the use of proceeds of 15 of Taiwan′s IC fabrication business and the study period is from 1998 to 2014, in 123 cases, according to the use of proceeds are defined to four categories: increasing working capital, investing of capital, retiring debt and general corporate purposes. The results are as follows:
1. The sources of funds of IC fabrication business are Seasoned Equity Offering which is 42.0% of total funding sources, followed by 27.4% of GDR and convertible bonds, and finally for 3.2% of the employee stock.
2. The use of proceeds of IC fabrication business are investing of capital which is 71.7%, followed by 14.6% of increasing working capital, 6.5% of retiring debt and 7.2% of general corporate purposes.
3. The main purpose of use of proceeds is investing of capital. In the Seasoned Equity Offering for the financing, the investing of capital for the use of funds ratio is 56.0%; in the GDR for the financing, the investing of capital for the use of funds ratio is 91.0%; in the issuance of convertible bonds for the financing, the investing of capital for the use of funds ratio is 76.5%.
4. The percentage of the internally generated cash flow from the firm’s continuing operations in total assets is 10.2%, followed by the percentage of SEO in total assets is 4.1%, and finally as a percentage of the bond in total assets is 1.9% of total assets. The main use of proceeds is investing of capital, followed by increasing working capital, and finally retiring debt. | en_US |