Taiwan-based LED firm High Power Opto has enlisted Semileds to become a shareholder with a close to 10% stake, which makes Semileds the largest single shareholder of the firm. High Power Opto reported net losses of NT$1.108 billion (US$37.91 million) in the first half of 2012.
Due to the economic downturn and the debt crisis in Europe, the LED industry has been seeing continuous price falls. Upstream LED chipmakers have been reporting mixed financial performance. The LED industry is currently going through consolidation as firms such as Epistar and Huga Optotech recently announced their decision to merge. Lextar, the LED subsidiary of AU Optronics (AUO), also announced its merger with Wellypower in 2012.
According to Chih-Sung Chang, president of High Power Opto, the firm's current capital is about NT$1.69 billion and due to the market downturn, the firm has been performing poorly in 2012. Hence, High Power Opto hopes to inject more capital from strategic partners that have resources to benefit the firm's R&D, number of patents, sales and finances.
High Power Opto noted that Semileds will become a member of the board and may increase its stake.
Semileds is a US-based company with manufacturing facilities in Taiwan and China. The firm's shares have been publicly traded on the NASDAQ. Semileds has been reporting monthly revenues of around US$80-90 million.
Semileds has around 10 units of equipment at its Taiwan plant. The firm plans to increase the total number of MOCVD equipment sets to 31 by the end of 2013 in Taiwan and China.
High Power Opto reported first-half 2012 revenues of NT$334 million, down 28% on year. Accumulated revenues from January-September were NT$510 million, representing an on-year decrease of 25.74%. The firm noted that market prices have been falling rapidly, and some product prices have been falling by more than 30%.