BOE to spend 12b yuan on production lines
Display giant BOE is planning to spend over 12.1 billion yuan (US$1.78 billion) to acquire two advanced FPD (flat panel display) production lines on the Chinese mainland, it announced on Thursday.
The deal would be the biggest merger and acquisition case in the industry.
BOE will acquire major stakes in lines in Nanjing and Chengdu from Nanjing CEC Panda, the Shenzhen-listed firm said in a statement to the Shenzhen Stock Exchange.
After the acquisition, BOE should be able to improve production capacity and expand into the high-end market, especially at the level of 50-inch, 58-inch and 70-inch models, GF Securities said in a report.
Demand for LCD panels used in TVs, computers and other devices is predicted continue to grow over the next five years with Chinese firms taking a bigger market share globally of about 60 percent.
The demand for liquid crystal displays rebounded in China after the coronavirus pandemic. The technology will still be the mainstream technology in the next five years with a high growth rate, according to Chen Yanshun, chairman of CODA, the China Optics and Optoelectronics Manufactures Association.
Currently, China’s top flat panel display makers are BOE and TCL, which acquired a production line in China from Samsung.
BOE’s share price fell 4.1 percent to 4.91 yuan on Thursday, compared with a 2.2 percent drop in the Shenzhen stock index. But BOE had already surged 8.6 percent this year.