Epistar Buys Into Huga Optotech

Taipei, May 31, 2010 (CENS)--Epistar Inc.'s board of directors on May 28 approved a plan to pay over NT$8.6 billion (US$268 million at US$1:NT$32) for a 47.88% stake in Huga Optotech Inc. as part of its ambition to boost strength of Taiwan's LED (light emitting diode) industry by integrating the island's LED chipmakers.

B.J. Lee, chairman of Epistar, currently Taiwan's No.1 LED chipmaker, said at a press conference marking the collaboration that the alliance is designed to beef up competitiveness of both companies in global market by co-sharing each other's resources and co-working on advanced technologies.

Huga's chairman, Jincai Chen, pointed out that by working with Epistar his company and Taiwan's LED industry would get momentum.

Industry watchers pointed out that Epistar has in recent years built up its strength by acquiring stakes in major players on the island including United Epitaxy Co., Ltd., Epitech Technology Corp., Tekcore Co., Ltd., Na Ya Photonics Inc., and Huga.

With these partnerships, Epistar is estimated to have as many as 296 metal organic chemical vapor deposition (MOCVD) machines to turn out blue-chip epitaxy wafers, outnumbering the output at Cree of the United States and at Nichia of Japan.

Epistar will acquire the Huga shareholding through stock swap, with an Epistar share for 2.23 Huga shares, and cash pay combined.