The world’s third-largest maker of liquid crystal display (LCD) screens has tied up with Japanese heavyweight Toppan Printing in a broad partnership to secure a supply of color filters and work together on technology development, the companies said Tuesday.
Under the agreement, AU Optronics of Hsinchu, Taiwan, will take a 39.7 percent stake in Toppan CFI (Taiwan), a subsidiary of the Japanese company that manufactures color filters.
The deal highlights AU’s desire to secure a supply of color filters, an important ingredient of LCD panels, and enable the company to control costs by no longer investing in its own color filter production lines, AU said.
The Taiwanese company also said it expects to gain from strong technology support from Toppan.
Companies in the global LCD panel business face stiff competition for key materials, particularly when demand spikes, which can happen at any time due to the popularity of any number of gadgets requiring such screens. LCD screens are used in a wide range of products, including LCD TVs, mobile handsets, PC monitors and laptops.
The deal is particularly important for AU due to its acquisition of Taiwanese rival Quanta Display, because the two companies use various types of factories that require specialized color filters.
The acquisition remains on track to close on Oct. 1, AU said.
By Dan Nystedt, IDG News Service (Taipei Bureau)
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