Asia Express - Display
Taiwan's Approves AUO' Investment in Chinese Panel Maker
June 24, 2011

Following the green light given by Taiwan's Ministry of Economic Affairs in December 2010 for Taiwanese LCD (Liquid Crystal Display) panel supplier AUO to set up a 7.5G production base owned by Longfei Optoelectronics in Kunshan, China, the Ministry announced that June 22 that the said proposed investment was officially granted, the United News Daily reported on June 23. The investment, claimed to be the first cross-strait LCD panel collaboration, allows AUO to purchase 49% stake in Longfei's 8.5G panel production base for US$796 million, which is expected to help AUO tap the lucrative Chinese LCD TV market.

In March, Taiwan's government lifted the ban to allow Taiwanese' LCD manufacturers to buy stakes in or merge with Chinese LCD manufacturers, given the restriction that the jointly-established LCD panel plants between Taiwanese and Chinese manufacturers could only use the LCD panel technology one generation behind that of technology currently used by Taiwanese manufacturers in Taiwan, according to the same source. To date, China's government only issued five LCD panel manufacturing licenses which are allocated by China's BOE (8.5G), China's Shenzhen Huashin (literal translation) Optoelectronics, China's Longfei Optoelectronics, Korean Samsung (7.5G) and LG (8.5G), according to the same source.