SOURCE: CinTel Corp.

April 26, 2007 11:48 ET

CinTel Invests $38 Million in Convertible Bonds to STS Semiconductor and Telecommunication Co, Ltd.

Continues Expansion Into Semiconductor Manufacturing Arena

LOUISVILLE, KY -- (MARKET WIRE) -- April 26, 2007 -- CinTel Corp (CinTel) (OTCBB: CNCN) announced that it has entered into an agreement to subscribe an aggregate of $38 million (37 Billion Korean Won) in convertible bonds (CB), convertible to the common stock of STS Semiconductor and Telecommunication Co, Ltd (STS) at Korean Won 8010 per share (Initial Conversion Price). Management believes that CinTel has secured very favorable conversion rates and will review the options upon maturity of the CBs and then act upon the option. The closing price of STS common stock, as quoted on the Korean Exchange, closed on Monday, April 23, 2007 at Korean Won 7,600 per share.

STS is a KOSDAQ-listed affiliate of BoKwang Group and also a 49% shareholder of Phoenix Semiconductor and Telecom, (Suzhou) Co, Ltd (PSTS) which is one of CinTel's subsidiaries. After being spun off from Samsung Electronics in 1998, STS has built a reputation as a top-tier semiconductor packaging and testing company through continuous innovation as well as a total solution provider and distributor of flash memory applications for highly technical electronic home appliances, semiconductors, TFT LCD appliances and other technology-based equipment. Sales in 2006 were more than $180 million and net profit was more than $4 million. STS's management believes that sales and profits are to increase in 2007. While STS's largest customer is Samsung Electronics Corporation, it has continued to diversify its customer base.

This agreement offers CinTel a unique opportunity to partially realize its long-term goal of becoming a semiconductor specialized company by consolidating various parts and/or companies involved in the semiconductor industry. Management believes this investment will ensure that CinTel's stream of profits will grow rapidly. STS will use the proceeds of the CB issuance to make capital investments. CinTel will also continue its strategic acquisitions in more diverse and profitable businesses focusing on the semiconductor industry and emerging technologies.

Sang Don Kim, the CEO of CinTel Corp, said, "This investment in STS is a natural extension of CinTel's expansion into semiconductor packaging business along with our investment in PSTS in 2006. Management believes that CinTel is assured to be a vibrant, profitable, and growing company well into the future. This agreement will strengthen CinTel's strategic relationship with the BoKwang group and increase our leverage in the semiconductor production field. Our shareholders will have the opportunity to experience significant benefits and increased shareholder value. Astute investors will see CinTel's strategy is creating a world-class stock that will provide significant returns on their investment."

About STS Semiconductor and Telecommunications (www.sts-semi.co.kr)

STS Semiconductor and Telecommunications is a subsidiary of BoKwang Group and the biggest semiconductor company in BoKwang's network. It began as a semiconductor packaging and testing specialty company after spinning off from Samsung Electronics in 1998 and is now a leading semiconductor packaging company, as well as, a total solution provider for memory application for home appliances, semiconductor and TFT-LCD application products. STS has been listed on the KOSDAQ since 2001 under the Ticker A036540.KS.

About BoKwang Group (www.bokwang.com)

From its beginnings as a producer of TV cathode ray tubes and electronic materials in 1983, BoKwang group has grown to a major conglomerate with over 30 subsidiary companies in hi-tech, leisure, finance, retail, logistic and culture businesses.

About CinTel Corp: (www.cintelcorp.com)

While CinTel maintains its position as a leader in Internet Traffic Management (ITM) systems; it has also begun expansion into creative new markets and worldwide distribution of Korean and Chinese-based semiconductor technologies. With its main headquarters in North America and operations worldwide, CinTel Corp. provides a wide range of enterprise technology solutions. Founded in 1997, CinTel introduced Korea's first dynamic server load balancer, which has now evolved into a world-class product line. With its ever expanding solutions with key partners and internal development, CinTel has created a conglomeration of technology products to include NAND flash memory packaging, LCD assembly, semiconductor packaging and testing specialists, as well as a total solution provider for memory applications for home appliances, semiconductor and TFT-LCD application products. CinTel's award-winning ITM solutions are marketed to customers worldwide, enabling customers to improve Internet and network traffic management, service levels, secure content, user experience, and reduce server loads and bandwidth demands.

Safe-Harbor Statement

This press release may contain statements (such as projections regarding future performance) that are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected as a result of certain risks and uncertainties, including but not limited to those detailed from time to time in the Company's filings with the Securities and Exchange Commission.

Contact Information

  • Contact:
    JD Sparks
    VP
    CinTel Corp.
    502-657-6077