In­nolux, AU Op­tron­ics merger ‘un­likely’: chair­man

The China Post - - LOCAL - BY JOHN LIU

Panel mak­ers In­nolux Corp. ) and AU Op­tron­ics Corp. ( ) to­gether oc­cupy over 30 per­cent of the mar­ket share, which makes a merger be­tween the two un­likely, In­nolux Chair­man Tuan Hs­ing-chein ( ) said af­ter a share­holder con­fer­ence yes­ter­day.

If a merger goes through, the sheer size of the two com­pa­nies will make man­age­ment very chal­leng­ing, Tuan said, adding that there are also con­cerns that a merger will be in vi­o­la­tion of the U.S. an­titrust law.

How­ever, it does not mean a merger is out of the ques­tion. Once the com­pa­nies are dis­solved into smaller busi­ness units based on prod­uct lines, such as large, medium and small pan­els, a merger be­tween dif­fer­ent busi­ness units is more likely, said In­nolux’s chair­man.

In ad­di­tion, Tuan pointed out four ma­jor changes in the in­dus­try over the last cou­ple of years.

The first is the rise of Chi­nese brands in the smart­phone in­dus­try like Huawei and Xiaomi; the sec­ond is the low tem­per­a­ture poly-sil­i­con

( pan­els’ grow­ing mar­ket share; the third is smart­phone pan­els’ fast ad­vanc­ing tech­nol­ogy, which in turn phase out tra­di­tional pan­els; the fourth is Ja­panese firms’ gain­ing an edge in the wake of the yen’s de­pre­ci­a­tion.

In­nolux Fore­cast Good De­mand in

Lat­ter Half of 2015

In re­gards to the com­pany’s op­er­a­tion, In­nolux Pres­i­dent Wang Jyh-chau ( ) said the de­mand for large-size TV pan­els now still ex­ceeds the sup­ply; and the de­mand for smart­phone pan­els is sim­i­larly strong, al­beit price com­pe­ti­tion is get­ting more in­tense.

De­mand for in­for­ma­tion tech­nol­ogy pan­els, on the other hand, is not as large, and Wang at­trib­uted it to the de­layed launch of Win­dows 10. But af­ter the prod­uct is un­veiled in July, sales of IT pan­els are ex­pected to climb back, Wang pre­dicted.

In­nolux said it would en­ter the In­dia mar­ket with Hon Hai Pre­ci­sion In­dus­try Co. ( ). How­ever, given the un­cer­tainty about the coun­try, In­nolux will con­sider set-

ting up panel mod­ule plants first.

China’s Sup­ply Chain Not the

Only Bar­rier

In the press con­fer­ence, In­nolux chair­man Tuan also com­mented on China’s industrial sup­ply chains, which are be­com­ing full-fledged and widely con­sid­ered a ma­jor threat to Tai­wanese firms.

China’s sup­ply chains have re­ceived greater at­ten­tion sim­ply be­cause China shares with Tai­wan the same lan­guage and cul­ture, while in fact, sup­ply chains orig­i­nat­ing in Ja­pan, South Korea, the U.S. also pose a threat to lo­cal busi­nesses, Tuan said.

It is not the first time that Tai­wan faces com­pe­ti­tion from China’s sup­ply chains, and it cer­tainly won’t be the last, Tuan said, adding that Tai­wan should not evade the chal­lenge and should strive to de­velop its strength.

The panel in­dus­try has en­coun­tered set­backs. Lack of wa­ter, util­ity, la­bor, money and industrial strat­egy have strained its devel­op­ment, said In­nolux Pres­i­dent Wang. How­ever, In­nolux’s debt has been cut from NT$300 bil­lion to NT$68 bil­lion.

Newspapers in English

Newspapers from Taiwan

© PressReader. All rights reserved.