KEMET Corporation today announced that it has sold its Wet Tantalum assets to a wholly-owned subsidiary of Vishay Intertechnology, Inc. for $35.2 million and other consideration in the form of a three-year term loan of $15 million. Sales generated by these assets during the Company’s fiscal-year ended March 31, 2008 were approximately $16.0 million and $4.4 million during the quarter ended June 30, 2008. Closing is scheduled to occur by the close of business today.
“During our process of exploring various alternatives for repositioning our capital structure, we were able to complete this transaction at an opportune time to allow the Company to use the proceeds of the asset sale and loan to redeem its outstanding Senior Notes with an outstanding principal balance of forty million dollars in an expeditious manner. This transaction will allow us to reduce our total debt outstanding; however, we are continuing to pursue financing alternatives that might provide greater flexibility and liquidity for the future compared to our current capital structure. We have also identified certain non-core assets that will be held for sale that are not in line with the Company’s strategic direction,” said Per Loof, KEMET’s Chief Executive Officer. “Regarding our current operating environment, we believe in our plans for building our business. The integration efforts are on track, we continue to service our customers globally, and I am confident that the integration and restructuring actions we have taken will improve our results. I can now redirect my focus to helping KEMET leverage its position as the “easy-to-buy-from” capacitance company. We believe there are many opportunities to build market share in areas where we see real potential for growth such as the emerging green technologies,” continued Loof.
KEMET will provide Vishay with certain manufacturing and other services during a transition period. Terms of the secured loan of $15 million to KEMET from Vishay include: a three-year non-amortizing maturity, an interest rate of LIBOR plus four percent, security consisting of accounts receivable currently in the amount of approximately $34 million, and certain limited events of default.
KEMET Corporation delivers high-performance capacitance solutions to customers around the world. KEMET offers the a complete line of surface-mount and through-hole capacitor technologies across tantalum, ceramic, film, aluminum, electrolytic, and paper dielectrics.
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