Cabot Microelectronics Corporation Declares Special Cash Dividend of $15 Per Share, or Approximately $345 Million in Total, A...
February 13 2012 - 8:00PM
Cabot Microelectronics Corporation (Nasdaq: CCMP), the world’s
leading supplier of chemical mechanical planarization (CMP)
polishing slurries and a growing CMP pad supplier to the
semiconductor industry, today announced that its Board of Directors
has declared a special cash dividend of $15 per share, or
approximately $345 million in total, payable to shareholders of
record on February 23, 2012, that will be paid on March 1,
2012. Approximately half of the special cash dividend, along
with related fees, will be funded from the company’s available cash
balance, and the remainder will be funded from a new five-year
secured credit facility, which the company executed today.
Under the terms of the new secured credit facility, the company
has arranged a $175 million term loan facility that will be fully
drawn to pay the special cash dividend, and a $100 million
revolving credit facility, which the company expects to be
initially undrawn. The term loan will bear interest at LIBOR
plus 150 to 200 basis points and the revolving credit facility
provides for a non-use fee of 25 to 35 basis points, both depending
upon the company’s leverage ratio. The company expects to
incur approximately $3 million of financing-related expense through
the remainder of its fiscal year 2012, including interest and
amortized financing fees.
The company’s declaration of the special cash dividend follows
the announcement on December 13, 2011 of its new capital management
initiative, intended to provide additional value to its
stockholders, which includes a leveraged recapitalization with the
special cash dividend. At $15 per share, the special cash
dividend represents approximately 30 percent of the company’s
closing stock price today. Pursuant to the rules of the Nasdaq
stock market, when a dividend is declared in an amount that exceeds
25 percent of a company’s stock price, Nasdaq must determine the
date on which that company’s shares will begin to trade without the
dividend, or ex-dividend. Applying this rule to Cabot
Microelectronics’ declaration of its special cash
dividend, Nasdaq has advised the company that the ex-dividend
date has been set as March 2, 2012, which is the first business day
following the payable date for the special cash dividend.
The company understands that this will mean that stockholders
who purchase the company’s stock after the record date of February
23, 2012 and before the ex-dividend date of March 2, 2012 will be
entitled to receive the special cash dividend, and stockholders who
sell the company’s stock during that same time period will not be
entitled to the special cash dividend. Investors who enter
into trades to purchase the company’s stock on or after the
ex-dividend date of March 2, 2012 will not be entitled to the
special cash dividend payable on March 1, 2012.
The portion of the company’s special cash dividend that will be
treated as a qualified dividend for U.S. tax purposes will depend
upon the amount of the company’s accumulated earnings and profits
as of September 30, 2012, the end of the company’s current fiscal
year, as determined by the Internal Revenue Code. Therefore,
at this time the company is not able to determine the portion of
the special cash dividend that will be treated as a qualified
dividend. However, based on its analysis and indications to
date, the company expects that the entire dividend will be treated
as a qualified dividend for U.S. tax purposes.
For more information about the company’s special cash dividend
and its new credit facility, refer to the company’s website,
www.cabotcmp.com, Investor FAQ and its Current Report on Form
8-K.
ABOUT CABOT MICROELECTRONICS CORPORATION
Cabot Microelectronics Corporation, headquartered in Aurora,
Illinois, is the world's leading supplier of CMP polishing slurries
and a growing CMP pad supplier to the semiconductor industry.
The company's products play a critical role in the production
of advanced semiconductor devices, enabling the manufacture of
smaller, faster and more complex devices by its customers. The
company’s mission is to create value by developing reliable and
innovative solutions, through close customer collaboration, that
solve today’s challenges and help enable tomorrow’s
technology. Since becoming an independent public company in
2000, the company has grown to approximately 1,000 employees on a
global basis. For more information about Cabot
Microelectronics Corporation, visit www.cabotcmp.com or contact
Trisha Tuntland, Manager of Investor Relations at (630)
499-2600.
SAFE HARBOR STATEMENT
This news release may include statements that constitute
"forward looking statements" within the meaning of federal
securities regulations. These forward-looking statements
include statements related to: timing of the payment of the
special cash dividend; future sales and operating results; company
and industry growth, contraction or trends; growth or contraction
of the markets in which the company participates; international
events, regulatory or legislative activity, or various economic
factors; product performance; the generation, protection and
acquisition of intellectual property, and litigation related to
such intellectual property; new product introductions; development
of new products, technologies and markets; natural disasters; the
acquisition of or investment in other entities; uses and investment
of the company’s cash balance; financing facilities and related
debt, payment of principal and interest, and compliance with
covenants and other terms; the company’s capital structure; and the
construction and operation of facilities by Cabot Microelectronics
Corporation. These forward-looking statements involve a number
of risks, uncertainties, and other factors, including those
described from time to time in Cabot Microelectronics’ filings with
the Securities and Exchange Commission (SEC), that could cause
actual results to differ materially from those described by these
forward-looking statements. In particular, see "Risk Factors"
in the company's quarterly report on Form 10-Q for the quarter
ended December 31, 2011 and in the company's annual report on Form
10-K for the fiscal year ended September 30, 2011, both filed with
the SEC. Cabot Microelectronics assumes no obligation to update
this forward-looking information.
CONTACT: Trisha Tuntland
Manager, Investor Relations
(630) 499-2600
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