Dynex Announces Filing of Preliminary Prospectus for Rights Offering to Shareholders

26.10.09

Lincoln, England, October 26th, 2009 – Dynex Power Inc., a leading specialist high power semiconductor company, announced today that it has filed a preliminary prospectus with the securities commissions in the provinces of British Columbia, Alberta and Ontario relating to a rights offering.


The Corporation’s subsidiary, Dynex Semiconductor Limited, is in the process of replacing and expanding its fabrication facility for silicon chips to be used in IGBT modules. The existing line, which processes 4-inch diameter silicon, is being replaced by two 6-inch lines. The installation of the two new lines will increase capacity approximately tenfold and is expected to require £11 million in capital expenditure, based on estimates received from suppliers, and an increase of approximately £1.5 million of working capital.

In order to start the expansion, a short term facility of £7.3 million was arranged with ICBC (London) Ltd, and was guaranteed by Zhuzhou CSR Times Electric. The net proceeds of the rights offering will be used by Dynex to repay the ICBC loan and to complete the expansion project.

Under the terms of the rights offering, shareholders of record will receive rights to subscribe for common shares in the capital of Dynex. Holders of rights that fully exercise their rights will be entitled to subscribe for additional common shares, if available, that were not otherwise subscribed for in the rights offering.

Zhuzhou CSR Times Electric, the majority shareholder of the Corporation, has indicated that it will subscribe for 75% of all common shares subscribed for as part of the rights offering.

The number of common shares to be issued, the number of rights required to purchase one common share, the subscription price per common share, the record date and the expiry date of the rights offering will be determined at the time of filing the final prospectus.

Further details concerning the rights offering are contained in the preliminary prospectus, which has been filed on SEDAR at www.sedar.com.

The rights offering is subject to regulatory approval, including that of the TSX Venture Exchange.

This press release is not an offer to sell or the solicitation of an offer to buy securities in any jurisdiction. The rights and common shares issuable on exercise of the rights have not been and will not be registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.