Wed, Jul 20, 2011 - Page 12 News List

E Ink set to invest NT$1.5 billion in Chunghwa Picture

By Jason Tan  /  Staff Reporter

Loss-making flat-panel maker Chunghwa Picture Tubes Ltd (CPT, 中華映管) yesterday said E Ink Holdings Inc (元太科技) could become a strategic investor through a private placement, a move that would help boost its utilization rate and improve earnings.

E Ink, the world’s biggest e-paper display supplier, will purchase NT$1.5 billion (US$52 million) in unsecured convertible bonds from CPT. The transaction is expected to be completed by the end of this month, according to a joint statement.

The conversion price for the bonds is set at NT$3.25 — a 6.3 percent discount from CPT’s closing share price of NT$3.47 yesterday.

E Ink could exchange the convertible bonds into CPT shares when they mature in three years.


CPT said the private placement would help it increase its capacity utilization rate and bottom line, according to the statement.

The investment would also help it focus on its niche business — small and medium-sized display panels and touch panels, it said.

E Ink said the strategic investment would allow it to secure panel supplies from CPT’s sixth-generation fab to cope with rising demand for electronics readers, the statement said.

CPT said in February it would form a US$3 million venture in China with the world’s No. 2 laptop computer contract maker, Compal Electronics Co (仁寶電腦), to produce touch panel glasses.


The deal will deepen the companies’ cooperation in the booming touch panel business, which has surged because of increasing demand for tablet devices.

It follows Compal’s purchase of a 4.5G color filter plant, to be converted into a facility for producing touch panel solutions including touch sensors, from CPT for NT$1.4 billion in December via a subsidiary.

Chunghwa Picture narrowed its net losses to NT$2.22 billion in the first quarter, from net losses of NT$2.7 billion in the same period last year. That translates into a net loss per share of NT$0.34, compared with last year’s loss per share of NT$0.42.

Boosted by news of the investment, CPT’s share surged 6.8 percent to NT$3.47. E Ink was down 0.4 percent at NT$54.80.

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