Innolux and Chi Mei Expect to Complete Merger by the End of Next March

Taipei, Nov. 30, 2009 (CENS)--Innolux Display and Chi Mei Optoelectronics are expected to complete their merger by the end of next March, one month ahead of the original schedule, so that the new entity can cash in on the market upturn with the synergy effect of the merger.

A Chi Mei executive confirmed yesterday (Nov. 29) that staffers of both companies are moving at full speed to undertake the merger operation, in order to complete it ahead of the designated date of April 30, 2010.

The early completion of the merger will enable the new entity to get ready for the advent of the peak season, helping Hon Hai, parent firm of Innolux, to make major inroads in the LCD TV market, after having dominated the LCD monitor market. The completion of the merger can materialize the synergy effect, in terms of lower procurement cost and higher management efficacy.

Moreover, only after the completion of the merger can the new entity resume Chi Mei's plan to invest in China, so that it can get ready to take action once the government lifts the existing ban on local FPD (flat panel display) makers to make cross-Strait investments.

In addition, following the announcement of the merger, AU Optronics, now Taiwan's leading TFT LCD (thin film transistor, liquid crystal display) and its up- and downstream cooperative firms have joined hands in containing the onset of Hon Hai Group, leading to the formation of two major rivaling groups in Taiwan's FPD industry. Due to the initiative of the AU group, some system makers have reportedly transferred their orders from Chi Mei to AU, prompting Hon Hai to accelerate the pace of the merger so that it can take countermeasures at an earlier time.