According to a resolution approved by its board of directors, TSMC will issue a total of NT$21.1 billion (US$743.2 million) in unsecured bonds to finance new facility establishment and equipment purchases, likely including an expected $12 billion U.S. chip fab in Arizona.
The NT$21.1 billion bonds will be comprised of a five-year tranche of NT$4.8 billion with a coupon rate of 0.5%, a seven-year tranche of NT$11.4 billion with a 0.55% coupon and a 10-year tranche of NT$4.9 billion with 0.6%, TSMC disclosed in a company filing with the Taiwan Stock Exchange (TWSE).
TSMC in February unveiled plans to issue up to NT$120 billion in unsecured bonds in Taiwan, and act as a guarantor to TSMC Global for the wholly-owned subsidiary’s issuance of US dollar-denominated senior unsecured corporate bonds of up to US$4.5 billion. The proceeds will be used to finance TSMC’s capacity expansion and/or pollution prevention related expenditures.
MacDailyNews Take: In January, TSMC executives reiterated that construction on a planned $12 billion plant in Arizona will begin this year. TSMC’s Arizona chip fab will be completed by 2024, with initial target output of 20,000 wafers per month, though the company envisions having a “mega scale production site” over the long term, Chairman Mark Liu added.