Taiwanese LCD giants merge to better compete globally

Innolux Display will buy Chi Mei Optoelectronics in an all stock deal valued at around US$5 billion

Taiwan's biggest LCD monitor maker on Saturday agreed to buy the island's second largest LCD screen maker in a bid to compete with South Korea's market leading giants.

Innolux Display will buy Chi Mei Optoelectronics in an all-stock deal whereby Innolux will trade one of its shares for every 2.05 shares of Chi Mei, the companies said.

The companies did not provide a value for the all-share stock deal, but a Taishin Securities analyst said Innolux Display will pay an 18 percent premium per share for Chi Mei Optoelectronics based on Friday's closing stock price. He said the deal values Chi Mei at around US$5 billion based on the number of shares Chi Mei reported at the end of the third quarter.

The deal is a sign of consolidation in the global LCD screen sector caused by the need to be big to compete. The combined Innolux-Chi Mei will be the world's fourth largest LCD screen maker and the biggest LCD monitor maker. Executives at a news conference in Taipei on Saturday said they hope the deal will help Taiwan better compete against South Korean powerhouses Samsung Electronics and LG Display, which rank as the biggest and second biggest LCD screen makers, respectively, in the world.

"Our first target will be to become number one in Taiwan," said Terry Gou, chairman of Hon Hai Precision Industry, the largest shareholder of Innolux and the world's largest contract electronics maker. AU Optronics, the third-largest LCD screen maker in the world, will be the new company's biggest competitor in Taiwan.

He also indicated that consolidation was necessary to keep Chi Mei Taiwanese, because foreign LCD screen makers might view it as a good buy out target. "Such a beautiful woman [Chi Mei] shouldn't marry a foreigner," said Gou.

The deal is expected to close May 1, 2010, Innolux said in a statement. Innolux will be renamed Chimei Innolux Corporation. The boards of both companies approved the deal on Saturday, but the transaction still needs shareholder and regulatory approval.

The current CEO of Innolux, H.C. Tuan, will become the president and CEO of Chimei Innolux, while the chairman of Chi Mei Optoelectronics, Frank Liao, will become the chairman of Chimei Innolux.

Join the newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags Innolux Displaylcd monitorsChi Mei Optoelectronics

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Dan Nystedt

IDG News Service
Show Comments

Cool Tech

Breitling Superocean Heritage Chronographe 44

Learn more >

SanDisk MicroSDXC™ for Nintendo® Switch™

Learn more >

Toys for Boys

Family Friendly

Panasonic 4K UHD Blu-Ray Player and Full HD Recorder with Netflix - UBT1GL-K

Learn more >

Stocking Stuffer

Razer DeathAdder Expert Ergonomic Gaming Mouse

Learn more >

Christmas Gift Guide

Click for more ›

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Ratchada Dunn

Sharp PN-40TC1 Huddle Board

The Huddle Board’s built in program; Sharp Touch Viewing software allows us to easily manipulate and edit our documents (jpegs and PDFs) all at the same time on the dashboard.

George Khoury

Sharp PN-40TC1 Huddle Board

The biggest perks for me would be that it comes with easy to use and comprehensive programs that make the collaboration process a whole lot more intuitive and organic

David Coyle

Brother PocketJet PJ-773 A4 Portable Thermal Printer

I rate the printer as a 5 out of 5 stars as it has been able to fit seamlessly into my busy and mobile lifestyle.

Kurt Hegetschweiler

Brother PocketJet PJ-773 A4 Portable Thermal Printer

It’s perfect for mobile workers. Just take it out — it’s small enough to sit anywhere — turn it on, load a sheet of paper, and start printing.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?