Chip maker NXP Semiconductors prices shares of IPO below expectations, raising $476 million

Friday, August 6, 2010

Chip maker NXP Semiconductors prices below target

NEW YORK — Dutch chip maker NXP Semiconductors NV priced shares of its initial public offering far below the expected range, raising $476 million, the company said late Thursday.

NXP priced 34 million shares for $14 each. It had expected shares to sell for $18 to $21.

The company expects to use net proceeds of $442.2 million, after expenses, to help pay down its debt load of about $5.1 billion.

The company’s chips are used in a wide range of products, from automobiles to wireless infrastructure equipment to TV sets.

It is the former chip-making arm of Philips Electronics NV, which sold an 80.1 stake in NXP to a consortium of private equity firms including Kohlberg Kravis Roberts & Co. and Bain Capital for 4.3 billion euros (about $5.5 billion at the time) in August 2006.

NXP booked revenue of $3.84 billion in 2009, down 29 percent from the previous year. It has posted a net loss for the past three years.

Its revenue grew 66 percent to nearly $1.17 billion in the first quarter, and its net loss narrowed 43 percent to $336 million.

Shares are expected to begin trading Friday on the Nasdaq exchange under the symbol “NXPI.”

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