Infineon Raises €692 Million in Cap Hike

FRANKFURT (Reuters) – German chipmaker Infineon (IFXGn.DE) said on Monday it had raised at least 692 million euros ($986 million) in a share offer, with U.S. investment firm Apollo taking up fewer shares than expected.

Infineon said Apollo could take up as many as 15 million shares or 1.4 percent of the company’s increased share capital.

“Infineon expects the decision of the Apollo-managed fund no later than during the afternoon tomorrow,” Infineon said.

Apollo had aimed to take a shareholding of between 15 and 29 percent and agreed to buy all shares in the rights issue that were not taken up by existing shareholders.

Infineon has said it plans to use proceeds from the rights issue to repay convertible bonds maturing in June 2010 and exchangeable bonds maturing in August 2010.

Analysts have said they expect Infineon to have a “comfortable cash cushion” by the end of its fiscal fourth quarter on September 30 thanks to the capital increase and the sale of its wireline business.

Infineon is Europe’s biggest automotive chip supplier and competes with privately owned Dutch NXP as well as Texas Instruments (TXN.N) and STMicroelectronics (STM.PA) (STM).

Chipmakers have endured an extended slump in their cyclical business for over a year as consumers and businesses slashed spending on computers, mobile phones and other electronics and major world markets slid into recession. ($1=.7019 euros)

(Reporting by Nicola Leske; Editing by Greg Mahlich)