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Epistar grows again with double merger plan

Three goes into one as GaN epiwafer and LED manufacturers Epitech and Highlink agree to merge with Epistar - subject to shareholder and regulatory approval.

Less than a year after merging with United Epitaxy Company (UEC), Epistar Corporation is set to swallow up two more of Taiwan's leading InGaN LED makers.

Epitech and Highlink will become part of the fast-growing Epistar brand from March next year, if the two deals get the go-ahead from shareholders and regulatory approval from the Taiwanese authorities.

Epistar president BJ Lee said of the deal, "The new Epistar will have all the capabilities to be a major player in the global LED industry and offer integrated and high-quality products to meet the needs of customers worldwide."

Already the world's largest manufacturer of AlGaInP LEDs for red, orange and yellow emitters, the latest move will catapult Epistar into becoming one of the top five global suppliers of InGaN LEDs.

Since the UEC merger, Epistar has seen its revenue more than double, posting sales of nearly NT$3 billion ($91 million) in the first half of 2006 and seeing its profit almost quadruple to NT$617 million..

If the Highlink and Epitech mergers get the go-ahead, Epistar will be by far the biggest InGaN LED player in Taiwan. Highlink chairman Semi Wang indicated that there would be little need for cutbacks following the consolidation:

"The sales channels of Epistar, Epitech and Highlink do not overlap with one another," Wang said.

Under the terms of the agreement, each 3.08 shares of common stock in Epitech and 5.5 shares in Highlink are set to become worth a single share in Epistar.

Buoyed by the speed with which it completed the UEC merger, Epistar is confident that its latest move will ensure its ability to compete at the highest level as the high-brightness LED market evolves.

Applications in backlighting of larger-scale PC, laptop and even television displays are now on the horizon, something that Epistar believes will ensure that demand for HB-LEDs will continue to boom.

"The new Epistar is certainly expected to play a pivotal role in the global LED supply chain for these applications," noted the Taiwanese company. "In the long run, the new Epistar will be well-positioned to be the world's leading manufacturing center for solid-state lighting by HB-LEDs."

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