Taiwanese LED package manufacturer Tyntek has ended investment in LED upstream chip manufacturer Alpha Plus Epi Inc (Alpha Plus Epi) with an estimated recognized loss of NT $1 billion (US $33.4 million) for 2013. The company however does not plan to completely back out of the LED chip market. Instead, the company is shifting focus from the Taiwan market to China. Tyntek through a joint venture with Fujian Electronics & Information established Fujian Prima Optoelectronics in 2010. This new epitaxy factory is projected to begin mass production in 2H14.

The trend of mergers in the  chip manufacturing industry remained unchanged in 2013. After the shutdown of Chimei Optoelectronics and Ubilux going out of business, Tyntek’s wholly owned subsidiary Alpha Plus Epi concluded business in 2013. The company has a total of nine MOCVD reactors, which were mainly used for blue LED chip production. Affected by the anemic LED industry, as well as price competition from Chinese manufacturers, the operation situation for the company was not ideal. Tyntek therefore began to gradually phase out business in 2012 with an estimated recognized loss of NT $1 billion in 2013.

However, Tyntek has not given up on the LED chip market and continues to be optimistic about the LED lighting market. The company entered into a joint venture between Chinese and Hong Kong manufactures in 2010 establishing Fujian Zhaoyuan Opto as the company’s center of LED chip development. Construction has been completed for the factory and is currently planning the initial installment of  30 MOCVD units. Production is estimated to begin in 2H14. The factory can accommodate a maximum of 100 MOCVD units. Further production expansion will depend on future market situation.