TSMC Likely to Buy Out World's Largest High-power LED Maker

Taipei, Sept. 16, 2009 (CENS)--Actively venturing into the renewable energy industry, Taiwan Semiconductor Manufacturing Co., Ltd. (TSMC), the world's largest wafer foundry service provider, is reportedly in talks with Philips Lumiled Lighting Company, the largest high-power LED (lighting emitting diode) maker in the world, on the acquisition of the latter.

According to industry insiders, the acquisition, which is not yet officially confirmed by TSMC, has been in a formative stage for three years, but both sides haven't yet reached a consensus due mainly to dissent on acquisition prices.

However, the merger is likely to be realized soon, because Philips Lumiled's largest shareholder Philips intends to dispose of the unprofitable company, which has been severely impacted by the global financial tsunami since last year.

Furthermore, insiders noted, all current conditions seem helpful to the realization of the acquisition, considering that Philips has built close ties with TSMC by holding a majority of stakes in the latter in the past, while TSMC is an ideal owner to help improve Philips Lumiled's operation efficiency and competitiveness with its cutting-edge R&D and production technologies.

The acquisition is deemed mutually beneficial to the both sides, mainly because Philips Lumiled is expected to ride on the growing application of high-power LEDs to further increase its influence on the high-power LED industry, as long as it is aided by TSMC in the future.

In fact, TSMC has been actively venturing into the market for green energy, including solar power and LED, since early this March, and plans to expand production value of the business to US$2 billion in 2018. Recently, the board in TSMC has announced a plan to invest US$50 million in developing solar energy, indicating its determination to step into the emerging segment.