Taiwan LED chipmaker Epistar has teamed up with China Electronics Corp (CEC), one of China’s state-owned conglomerates, to set up a joint venture, aiming at tapping into an expected boom in demand for LEDs across the Strait.

According to Rider Chang, Epistar’s vice president of finance and accounting, Epistar will own a 40 percent stake in the venture, with CEC controlling 50 percent, while the remaining 10 percent will be shared by other Taiwanese firms, including Everlight and TPV Technology Ltd.

The venture will have a plant in Xiamen, China, with production to begin in 2012 and it will cost as much as US$200 million over a four-year period.

Chang  also suggested that Epistar expects the LED lighting business — which currently totals about 20 percent of its sales — will gain momentum in the near future.