Taiwan Hon Hai Group has injected US$35 million to set up an LED venture in mainland China at a cost of US$35 million. And it’s reported that polysilicon manufacturer GCL-Poly Energy Holdings Ltd. of mainland China is also a strategic partner in the investment.
The new venture, headquartered in Nanyan, Henan Province, will seek partners in all of the mainland’s provinces to drum up LED streetlight business, pointed out by the group.
GCL-Poly is listed on Hong Kong Stock Exchange, reporting net income of HK$4.2 billion (US$555 million at US$1: HK$7.7) on revenue of HK$25.5 billion (US$3.3 billion) in 2011. Before the cooperation in LED venture, the company has partnered with Hon Hai in clean-energy business.
Hon Hai pointed out that although GCL-Poly is a major strategic partner of it, the mainland Chinese manufacturer will not hold shares in the LED venture. Their cooperation will be based on the model that GCL-Poly bids for streetlight contracts while the venture supplies LED lighting and service. They share profits.
The two companies hope that the cooperation will maximize their share of the mainland’s clean-energy market by combining their respective specialties.
In fact, this LED venture is one part of Hon Hai’s US$146 million investment plan in the mainland announced recently. Other capital will go to the group’s precision, electronic components and electrical equipment businesses in the mainland.
