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Tyntek to spin off solar-module unit by end of July

Tyntek Corp (鼎元光電), one of the nation's leading makers of chips used in light-emitting diode (LEDs), plans to spin off the red-hot solar-module division in a bid to strengthen its competitiveness and profits, a company official said yesterday.

Tyntek officials held a press conference after the firm's board of directors gave the green light to the restructuring proposal.

Tyntek supplies chips to the nation's major LED packagers such as Everlight Electronics Co (億光).

"Solar products are a lucrative business ? We hope to expand this division by separating it," Tyntek chairman Bosco Foo (傅佩文) said.

The solar module unit is expected to account for 20 percent of the chipmaker's revenues for this year, up from less than 10 percent last year, company officials said.

"Capacity still cannot meet customers' demand," president Deng Ji-ren (鄧及人) said.

A big chunk of its revenues, however, still comes from making chips for red or yellow LEDs, which are used in a variety of applications including displays, outdoor signboards and traffic signals.

Tyntek is planning to boost its combined revenues by 33 percent this year to NT$3.2 billion (US$98.58 million), compared to NT$2.4 billion last year, spokeswoman Chiu Mei-lin (邱美玲) said.

Overall net income will rocket 70 percent to NT$290 million this year from last year, Chiu said.

"We don't expect the spin-off will have a serious impact on the company's profits this year. The reduction will be less than 10 percent," she said.

The solar-module division is expected to make NT$700 million in revenues this year, she said, adding that the separation is expected to be completed by late July.

The new solar module company would be wholly-owned by Tyntek and would have an initial capital of NT$100 million, Chiu said.

The company plans to increase capital in the new company by 50 percent to NT$150 million via alliances next year before trading on the over-the-counter GRETAI Securities Market (櫃檯買賣中心), she said.

Possible partners would be Tyntek's customers and suppliers, she said, or liquid-crystal display panel makers.

Tyntek sources more than 60 percent of the solar cells it uses from the country's top solar-cell maker Motech Industries Inc (茂迪).
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