Qimonda AG American Depositary Shares (fka QMNDQ)

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Infineon to offer 75 mln eur in Qimonda aid-paper

FRANKFURT, Dec 18 (Reuters) - German chipmaker Infineon IFXGn.DE is willing to help its ailing Qimonda (QI) unit with a loan of 75 million euros ($107.8 million) in combination with a sale of a stake in Qimonda to the state of Saxony, its chief executive said.

The loan combined with proceeds from selling a stake to Saxony would amount to more than 100 million euros, Infineon CEO Peter Bauer told German daily Die Welt in an interview to be published on Friday.

"Qimonda is very dear to my heart and we want to help as best as we can," Bauer said.

The state of Saxony, said on Tuesday it would be willing to help Qimonda with a 150 million euro ($210.2 million) loan only if parent Infineon contributed the same amount.

But Infineon rebuffed the offer saying the state's requirements were beyond its abilities.

Bauer rejected criticism from Saxony's government that Infineon was not contributing its share to save Qimonda, which has warned that it faced a cash crunch by early next year if it did not find a new investor.

"Don't pass the buck to us. From the start, we have made our position clear and have always said how far our means would reach," he added.

Qimonda, like its competitors, is struggling with a slump in prices for dynamic random access memory (DRAM) chips, used mainly in PCs, and has tried to compensate with strict cost-cutting measures and job cuts.

Bauer told the paper he was confident talks to find a solution would continue.

Asked if the federal government would particpate in potential rescue measures, Bauer only said: "We have heard of a willingness to attend to the matter."

Bauer reiterated that the current credit crunch will be a challenge for Infineon's refinancing but dismissed the idea that Infineon could find itself in a situation similar to Qimonda.

Infineon said earlier this month it has been hit hard by the economic slowdown and warned that its already bleak outlook for 2009 may worsen.

Infineon, which spun off its former unit in 2006 and listed it on the New York Stock Exchange in the hope of cutting its exposure to the volatile memory chip market, has been trying to find a buyer for most of the 77 percent of Qimonda it owns.