Local light-emitting-diode (LED) chipmaker Tyntek Corp (鼎元光電) said yesterday it would seek to acquire a smaller rival via share swap to expand its output of LED chips amid rapidly growing demand for flat panels.
The acquisition will help Tyntek secure the third spot in the nation’s LED chip industry, after Epistar Corp (晶電) and Optotech Corp (光磊).
Tyntek said its board has approved a proposal by management to acquire Ubilux Optoelectronics Corp (晶發光電), a LED chip manufacturing arm of Powerchip Semiconductor Corp (力晶半導體), the nation’s second-largest computer memory chipmaker.
“The acquisition will create a good business opportunity as flat-panel backlight and general light will be two major drivers for LED chips over the next two years,” Tyntek president J.R. Deng (鄧及人) told a press conference.
The Hsinchu-based company hopes to build a bigger presence in the booming LED backlight sector, as growing demand for LED TVs has caused severe supply constraint.
One Tyntek share will be exchanged for 1.375 Ubilux shares, the company said in a statement.
Tyntek will issue 88.07 million new common shares for Ubliux shareholders, making the deal worth about NT$2.81 billion (US$86.8 million) based on Tyntek’s closing price of NT$31.90 yesterday.
After the acquisition, Powerchip will become the biggest shareholder at Tyntek. The deal is scheduled to close on March 1.
In an aggressive capacity expansion, Tyntek aims to increase nine-fold its MOCVD tool, which is used to make LED chips, from six units at present to 30 units by the end of next year.
This would help generate at least NT$800 million in revenue next year and another NT$2.5 billion in 2011, Deng said.
Tyntek posted losses of NT$67.26 million in the first half of this year on sluggish demand, compared with net profits of NT$16 million a year ago. Revenues plunged 62 percent year-on-year to NT$1.3 billion, from NT$3.42 billion.
Tyntek shares jumped 2.41 percent to NT$31.90 yesterday.
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