Taiwan Today

Epistar Corp., Taiwan’s largest epiwafer and light-emitting diode maker, announced Dec. 21 its board has approved two major investment projects in the Chinese mainland worth a combined total of close to US$130 million. For the first project, Epistar will invest in stages up to US$120 million on epitaxial wafers and chips production facilities located in Changzhou City, Jiangsu Province. The other gives approval for Epistar to form an alliance with United Microelectronics Corp., Taiwan’s main dedicated microchip foundry, in jointly setting up a new company in Shandong Province. The new company, called United LED Corp., will produce epitaxial chips for LEDs. UMC and Epistar will each have a 50-percent share in United LED. Epistar, which will invest US$8 million in United LED, will be responsible for producing LED chips and developing production processes, while UMC will work on LED-related applications, according to the Epistar press release. The two partners have not worked out the specific details regarding production planning and the specific arrangements of the board, said Jou Ming-jiunn, president of Epistar. Thanks to the issuance of global depositary receipts earlier this year, Epistar is flush with nearly US$617 million in cash. Jou pointed out that Epistar’s investment philosophy is to form strategic alliances with partners to secure a flexible supply of key materials. Such a strategy will prevent LED makers from blindly engaging in a capacity expansion race, which has resulted in oversupply in the past, Jou said. With a 15-percent stake in Epistar, UMC is one of the company’s three major shareholders. Industry sources said that United LED is the latest move by the foundry in its venture into the green energy sector. Group member Power Light Tech Co. Ltd., a locally-based maker of LED streetlights, previously announced a plan to set up production facilities in Shandong. (SFC-HZW)