Taipei, Feb. 6, 2010 (CENS)--Chimei Innolux Corp., a merger between former Chi Mei Optoelectronics Corp. (CMO), Innolux Display Corp., and TPO Displays Corp. scheduled on April 1, will further expand the capacities at its 8.5th-generation (8.5G) plant in Taiwan and a LCD module (LCM) facility in Ningbo, Zhejiang Province of China, according to Chinese-language economic daily newspaper Economic Daily News (EDN).

In addition, Chimei Innolux plans to step into two business scopes, including printed circuit board (PCB) assembly and backlight module production, so as to further vertically integrate its LCD TV assembly business.

Industry sources said that currently Taiwan Surface Mounting Technology Corp. (TSMT), the world`s largest PCB assembly supplier, is filling about 40% to 50% of Chimei Innolux`s PCB assembly demand.

In addition, Chimei Innolux`s move in backlight business is also expected to generate some impacts on Radiant Opto-electronics Corp. and CoretronCoretronic Corp., top-two backlight module suppliers in Taiwan.

Industry insiders said that Chimei Innolux has been actively extending its business scope into key parts. In the future, they added, there is expected to be a clearer line between the supply groups to Chimei Innolux and AU Optronics Corp. (AUO), currently the largest thin film transistor-liquid crystal display (TFT-LCD) panel manufacturer in Taiwan.

The merger date of Chimei Innolux has been delayed to April 1 from March 1, and before the merger the new company has won many big-ticket orders through the Hon Hai Group (Innolux is an affiliate of Hon Hai).

According to a senior manager at CMO, Chimei Innolux has landed many difficult-to-win panel orders and achieved clear business advancement in small/medium-sized panel market. After the formal merger, the panel maker will expand capacity.

Insiders said that CMO`s LCM plant in Ningbo will diversify into production of backlight modules and PCB assembly, making it a hub of Chimei Innolux`s LCD TV assembly business.

(by Quincy Liang)