Epistar Corp (晶元光電), the nation’s biggest LED chipmaker, is to undertake a joint venture with China Electronics Corp (CEC, 中國電子信息產業集團), one of China’s state-owned conglomerates, to tap into an expected boom in demand for LEDs across the Strait.
The joint venture will cost as much as US$200 million over a four-year period.
Epistar will own a 40 percent stake in the venture, with CEC controlling 50 percent, while the remaining 10 percent will be shared by other Taiwanese firms, including LED chip packager Everlight Electronics Co (億光) and the world’s largest monitor maker TPV Technology Ltd (冠捷), said Rider Chang (張世賢), Epistar’s vice president of finance and accounting.
“This venture will secure us steady orders from CEC and its vast number of subsidiaries,” he said during a media tour at Epistar’s Tainan site.
The venture will have a plant in Xiamen, China, with production to begin in 2012, he added.
China has been in the market for LED products ranging from light bulbs, televisions to street lamps, in a move to go “green.”
This provides companies such as Epistar with huge business opportunities as it aims to supply chips to makers in China, which will then bid for projects from municipal governments with the final products.
Epistar expects the LED lighting business — which currently totals about 20 percent of its sales — will gain momentum in the near future, according to Chang.
LED backlighting, used in flat-screen televisions, monitors and notebooks, makes up 50 percent of its sales.
Founded in 1989, CEC is one of the largest state-owned IT companies in China with a registered capital of 5.9 billion yuan (US$885.8 million) and employs more than 70,000 people.
CEC administers a group of IT companies in China and controls 61 second-level subsidiaries, including 13 listed holding companies such as Panda Electronics Group Co (南京熊貓) and Great Wall Technology Co (長城科技).