Trade Resources Industry Views Everlight, Epistar Discuss The Possibility of Increasing The Investment From China

Everlight, Epistar Discuss The Possibility of Increasing The Investment From China

Tags: LED

Taiwan's Executive Yuan has been discussing the possibility of increasing the investment limit of China-based funds to Taiwan's LED industry. According to Robert Yeh, chairman of LED packaging house Everlight, no China-based firms have indicating any intentions to become shareholders of Everlight and Epistar. Yeh believes there should only be a few Taiwan-based firms willing to accept funds from China.

Yeh added that LED firms in Taiwan and China are quite different as the former emphasize on distribution of labor while the latter prefer vertical integration. China-based firms have abundant funds, large markets, and have been hoping to obtain Taiwan-based firms' technologies. However, Taiwan-based firms should leave core businesses in Taiwan, said Yeh. Many Taiwan-based firms hope to gain market share in China, but the most important thing to do is to control distribution channels, Yeh stated. In addition, there are many Taiwan-based firms that are currently engaging in joint venture projects with China-based peers, hence the effect of having China-based funds should be limited, Yeh pointed out.

LED chipmaker Epistar plans to inject a capital of NT$2.5 billion (US$85 million) through private placement in 2012. Some believe the participants are China-based firms. However, Epistar only indicated that information about the participants will not be disclosed.

Compared to the conservative attitude towards China-based funds displayed by Everlight and Epistar, LED firms such as Formosa Epitaxy and Genesis Photonics have reportedly been discussing the possibility of having China-based firms as shareholders. Formosa Epitaxy is said to be cooperating with China-based panel maker BOE on LED backlight products for panels.

Genesis Photonics also has been said to be working with Sanan Optoelectronics, a China-based large-size LED chipmaker. Sources indicated that Sanan has been interested in investing in Taiwan-based firms with its initial targets locked on upstream chipmakers. Sanan's small- and medium-size blue LED technology has been catching up to Taiwan-based peers, but the firm still needs to improve high-power LED products and TV backlight applications. Sanan may hope to increase recognition in the international market through investing in Taiwan-based firms.

Sanan currently has cash of CNY1.6 billion (US$253 million).

Source: http://www.digitimes.com/news/a20120924PD203.html
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Everlight, Epistar conservative about investments from China
Topics: Lighting