[Breaking News] Epistar Acquires TSMC SSL

Last week LEDinside reported Epistar’s intention of acquiring TSMC SSL, a LED lighting subsidiary of leading Taiwanese semiconductor manufacturer TSMC, the two companies have released a joint press release Friday (Taipei Time) confirming the deal.

Epistar will be purchasing 94% of TSMC SSL shares at a price of NT$ 1.46 (US $0.05) per share. The leading Taiwanese LED manufacturer’s NT$825 million investment to acquire 565.02 million TSMC SSL shares was approved by TSMC board members on Jan. 9, 2015.

Once the acquisition is completed, Epistar will have a 94% stake in the company, and TSMC will withdraw from its former subsidiary operations. TSMC SSL will be operated by Epistar and the company's existing management team in the future.

Three positive outcomes from Epistar and TSMC SSL Integration

TSMC SSL has inherited most of TSMC’s company culture, talent, and information system. In recent years, the company has been promoting innovative high efficiency Phosphor on Die (PoD) LED chip package technology for LED lighting solutions, but several factors have made it difficult for the company to turnaround losses in the short term. Some of these factors include the company’s late start in the industry, oversupply situation in the LED industry caused by the industry’s rapid expansions in recent years, and challenges from acquiring patents and distribution channels.

Epistar on the other hand is a world renowned LED chip and die manufacturer, with patents recognized by leading international manufacturers. The Taiwanese manufacturer has signed patent cross licensing agreements with Toyoda Gosei and Philips, and has a global distribution network and clients worldwide.

Speaking about the expected outcome through this partnership, Stephen Tso, Chairman of TSMC SSL said: “We believe this partnership will create three positive outcomes in the future; it will boost Epistar’s operations; speed up the LED industry development; benefit TSMC SSL shareholders and employees.”

“We are open and optimistic to any opportunities that can strengthen Epistar’s competitiveness and benefit our shareholders rights,” said Epistar Chairman B.J. Lee. “TSMC SSL might not have a production capacity that matches Epistar, but we hope by working together we can introduce different industry approaches and stimulate or employees and system to come up with new ideas, which in turn can strengthen Epistar’s operations.”

LED industry growth and market penetration is projected to soar between 2014 to 2017. Just last month, Epistar completed the acquisition of FOREPI to meet manpower demands as the company quickly expands operations. The former second largest Taiwanese LED chip maker has become a wholly owned subsidiary of Epistar. 

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