Aug 17, 2000

Ritek Corp., Taiwan's largest optical storage media maker, recently announced plans to acquire 35% of Taiwan Nano Electro-optical Co., Ltd., a newly established maker of back-light modules for liquid crystal displays (LCDs).

Taiwan Nano was established in March this year and is capitalized at NT$400 million (US$12.9 million at NT$31:US$1).

The R&D team at Taiwan Nano, which brings together professionals from the company's Japanese partner and Taiwan's Industrial Technology Research Institute (ITRI), has developed print-less technology for mass producing back-light modules. The company has sent test modules made with the technology to several local LCD makers such as Unipac Optoelectronics Corp., Wintek Corp., Picvue Electronics Ltd., and Acer Display Technology Inc.

Taiwan Nano's plant is under construction at a 6,667-square-meter site in Chungli, northern Taiwan. The facility is scheduled to be completed by the end of this month and start mass production in the fourth quarter this year. Scheduled annual capacity in the initial stage is 1.5 million back-light module sets for 13.3-, 14.1-, and 15-inch LCD models. Output will double to three million sets in the second stage.

According to statistics compiled by the Material Research Laboratories (MRL) of the ITRI, back-light modules account for about 16% of the cost of a 15-inch thin film transistor (TFT)-LCD. Domestic demand for the modules is expected to grow rapidly in the coming years as local producers ramp up TFT-LCD output.

Global demand for back-light modules reached 35 million sets last year, according to the MRL statistics. The volume is expected to hit 50 million sets this year and 70 million sets in 2003, respectively.

With profit margins shrinking on its core business of optical storage media, Ritek has been accelerating its expansion into other optoelectronic fields. The company recently teamed up with Sunplus Technology Co., Ltd. to develop driver integrated circuit (IC) chips, a key component used in LCDs. It also plans soon to set up a new subsidiary, Ritek Display Technology Co., to make OLED (organic electro-luminescence display) products.