Harvatek, LED packaging business from Taiwan, has announced to quit joint venture project with China-based TV brand TCL. Harvatek stated that both parties have had taken different attitudes towards some terms, and after careful consideration, Harvatek decided to transfer its 50% stake in the joint venture to TCL. Harvatek stated that it has invested around CNY15 million (US$2.44 million) in this project for two years.
On June 24, 2011, Harvatek signed a joint venture agreement with TCL through its subsidiary, Honor Light Limited, to establish an LED packaging plant in Guangdong province, China. Each party owned 50% stakes. Initially, the plant was set up with an annual capacity of two billion units, and was scheduled to put into operation in March 2012. However, after the announcing of this agreement, rumors concerning a suspension of the plans started circulating. Harvatek has never confirmed the rumors.
Industry sources revealed that a number of firms from Taiwan and China had established cooperation relationship through joint ventures in 2010-2011. However, many investment projects have been suspended because of the economic downturn and market oversupply. Moreover, there have been rumors saying that TCL is very strict with cost control and suppliers usually have small profit margins. This may also one of the reasons why Harvatek withdraw from the joint venture.
