Elpida shares up 17.8%

The dram chip manufacturer's president and ceo, Yukio Sakamoto (pictured), announced on Wednesday Elpida's plans to raise the money by issuing mainly preferred shares in two subsidiaries set up this month to five business partners. It was hoped that the fundraising would boost the level of net assets on Elpida's balance sheet enough to enable it to meet a key debt covenant when it closes its books for he financial year. The company has also raised its stake in wafer testing firm Tera Probe to make it a subsidiary, in a move seen helping it meet lenders' requirements that it keep its shareholders' equity to at least 75% of the previous year's level. Elpida is challenging Samsung Electronics and Hynix Semiconductor for market share and has been looking to raise money to shore up its balance sheet. In December, the company was forced to redeem most of a 50 billion yen convertible bond due to a slide in its share price.