San’an Opto Issues Stocks to Fund 100 MOCVD Equipment

San’an Opto has raised about RMB 3.24 billion (US$ 530 million) by privately issuing a total of 151 million stocks to eight specific investors, according to a recent report by Chinese-language Aastocks.com. The funding raised is equivalent to building a new San’an Opto enterprise. 

The report based on a recent San’an Opto announcement noted the stocks were sold at RMB 21.8 each. According to the Chinese media understanding, the company issued 15.14 million stocks to the company’s second largest shareholder San’an Opto Fujian. The group’s stock share incrementally increased to 17.00 percent with the purchase, compared to the previous 16.33 percent.

Additional 100 MOCVD equipment equivalent to building another San’an Opto

The company private stock issuance was mainly to fund the second phase of Wuhu Opto-electronics Base industrialization in which the company has raised RMB 2.80 billion out of the targeted RMB 4.1 billion. The remaining RMB 500 million will be used as liquid capital.

San’an Opto has dispatched 144 MOCVD equipment in manufacturing and R&D, according to the report. The company currently has 22 MOCVD equipments in Xiamen, 19 in Tianjin, and 103 in Anhui. The company will have a total of 244 MOCVD equipments, once it raises enough capital to purchase the additional 100 equipment. The company’s manufacturing capacity will exceed others in the industry.

In 2012, San’an Opto LED chip market share in China reached 23.3 percent compared to 10 percent in 2008, and has maintained its market share advantage. The global market share of Chinese LED chips is only 23 percent at the moment, and San’an Opto’s efforts in increasing internationalization has raised its influence in the global market.

Industry insiders believe LED epiwafer and chip manufacturing industry have shown signs of strong enterprises becoming even larger. In the future market competition, San’an Opto’s size advantages will be increasingly evident, while small companies that lack technological strengths will be eventually eliminated.

The company’s brand has obvious advantages, with more than 10 listed Chinese companies as clients, and is gradually gaining recognition from large international manufacturers. San’an Opto pointed out the company is transiting from being a domestic leader to an international pioneer. Aside from possessing domestic and oversea business integration, the company plans to become one of the top five global companies within the next three years. The company is currently vying the world’s top three spot.

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