Sat, Dec 14, 2002 - Page 11 News List

Compal unit seeks cash injection to boost output

BLOOMBERG , HSINCHU

Compal Electronics Inc's (仁寶電腦) flat-panel unit, Toppoly Optoelec-tronics Corp (統寶光電), plans to raise NT$10 billion (US$287 million) to double production of color screens for mobile phones.

Compal, which owns 35 percent of Toppoly, and Uni-President Enterprises Co (統一企業), which has 30 percent, will provide part of the sum as a cash injection, said Toppoly spokeswoman Wilma Wei (魏秋瑞). The company is also seeking funds from the government, she said.

Teco Group (東元集團) is also a major stakeholder of Toppoly.

Toppoly supplies panels to Compal, which makes notebook computers as well as mobile phones for companies such as Motorola Inc, the world's second-largest handset maker.

The new funds will help Toppoly double its output of sheets from which panels are cut to 40,000 a month by the first quarter of next year, Wei said.

"Compal is facing shortages of color screens," she said, adding that Toppoly is also "talking to some other big-name companies about becoming a supplier."

Nokia Oyj predicts global handset sales will grow 10 percent next year on demand for phones with color displays and built-in cameras.

Toppoly is the first Taiwan flat-panel maker to compete with bigger rivals in Japan and South Korea in production of so-called low-temperature polysilicon screens, designed for small high-resolution displays such as those in phones.

Its largest competitor is Samsung Electronics Co, the world's third-largest handset maker and the No. 1 maker of flat-panel displays.

Part of the new money will be used for operating capital, Wei said, without elaborating.

Toppoly borrowed NT$17 billion earlier this year in a loan arranged by International Commercial Bank of China (中國商銀) and other local lenders. Its latest fund-raising plan was reported yesterday by a local Chinese-language newspaper.

Other flat-panel makers such as Chi Mei Optoelectronics Corp (奇美光電) and Chunghwa Picture Tubes Ltd (中華映管) have been forced to cancel plans to raise money for expansion by selling new shares.

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