Siltronic Share Offering May be Worth €480 Million

Germany’s Wacker-Chemie and its electronic chemicals subsidiary Siltronic have announced €30-38 per share as the price range for the planned initial public offering of Siltronic shares in Frankfurt on June 11. The final offer price will be determined on the basis of a bookbuilding process.

The shares will be offered publicly in Germany and Luxembourg to private and institutional investors. Elsewhere, they will be offered for subscription by way of private placements.

Up to 12,650,000 shares will be placed altogether, valuing the offering at around €480 million. Of the total, l.5 million will be new shares issued by Siltronic in a capital increase. Six million will come from Wacker’s existing shareholdings, along with 1.65 million additional shares in the case of an over-allotment.

If all shares, including the over-allotment, are placed, Siltronic would have a free float of 42.2% of its share capital after the capital increase. Wacker would thus retain around 57.8% of the share capital after the transaction is completed (or 63.3% if the over-allotment option is not exercised).

“Siltronic is excellently positioned in an attractive market environment,” said CEO Christoph von Plotho. “Comprehensive initiatives undertaken in recent years have paid dividends. We have thoroughly prepared Siltronic for its independence and are ideally placed for the planned ipo and a successful, independent future.”

The Munich company, world’s third largest producer of hyperpure silicon wafers for the semiconductor industry, said it has further increased its competitiveness in recent years, expanding its market share to 14% in revenue terms.

Through a stringent cost reduction roadmap, Siltronic said it succeeded in reducing its costs by more than €80 million in 2013 against 2012. In 2014, further savings of some €55 million were generated.

In the past five years the company claims to have almost doubled productivity – based on wafer surface produced per working hour – in its 300 mm wafer production in Germany, while cutting variable production costs by over 40%. Over the past ten years, three of Siltronic's seven production sites were closed.

Management intends to use net proceeds from the IPO to refinance debt and to strengthen the company’s existing net cash position as well as improving its technological capabilities. (dw)