Chi Mei borrows to build 6G LCD fab

Chi Mei Optoelectronics Corp (奇美電子) borrowed NT$52.66 billion (US$1.6 billion) from 21 banks to build a liquid-crystal-display factory in Taiwan.

Chi Mei increased the loan size from an original target of NT$40 billion, senior vice president Jack Lin (林榮俊) said in a statement yesterday.

The company will use the loan to fund a so-called sixth-generation (6G) plant, which will make 32-inch and 37-inch flat TV panels.

The flat screen maker, which has the fourth-biggest market share of flat panels, needs the loan to increase capacity to catch up with its bigger rivals AU Optronics Corp (友達光電), LG.Philips LCD Co and Samsung Electronics Co, the top three flat-screen makers in the world.

``We see strong support and high recognition for CMO's effort and future development in the industry,'' Lin said.

The loan has a maturity of seven years, the statement said.

Chi Mei has appointed the Bank of Taiwan (臺灣銀行) to manage the syndicated loan, the statement said, while Calyon, ABN Amro Holding NV and HSBC Holdings Plc are among other banks which have joined the deal.

Chi Mei had 11 percent of the market for LCD panels at the end of last year, said DisplaySearch, a technology industry researcher based in Austin, Texas.

South-Korea-based Samsung is the biggest producer with a 20 percent market share, followed by LG.Philips with about 19 percent and AU Optronics is third with 16.7 percent.