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AUO sells stake in Chinese LCM venture to Wistron.

Taipei, May 23, 2012 (CENS) -- AU Optronics Corp. (AUO), one of the top-two manufacturers of large-size thin film transistor liquid crystal display panels (TFT-LCD) panels in Taiwan, recently decided to sell all its stake in a LCD module (LCM) joint venture with local EMS (electronics manufacturing services) or CEM (contract electronics manufacturing) provider Wistron Corp. to the venture partner, as most panel suppliers have been strategically upgrading shipment ratio of semi-finished products, or open cells.

The AUO-Wistron venture operates a module production factory at the "Wistron Optical Campus" of the Zhongshan Torch Hi-tech Industrial Development Zone in Guangdong Province, China. AUO and Wistron own 51% and 49% of the shareholding of the joint venture, respectively.

Wistron is a major LCD TV supplier to Sony. AUO has set up several LCM ventures with different system makers to strengthen partnerships with major customers.

As more and more downstream system makers have set up their own backlighting module system (BMS) plants, most customers now ask TFT-LCD panel suppliers to ship semi-finished open cells, especially larger-size LCD TV panels.

AUO said that it sold all its stake in the LCM venture to Wistron, but still supplies products to the latter.

David Hsieh, vice president, DisplaySearch Greater China, pointed out that a backlighting module accounts for about 20% of a LCM's total cost, so panel suppliers' revenues are expected to drop as they now ship more open cells to customers. On the other hand, he added, panel makers could get less pressure from operation losses because their shipments do not include the backlighting modules.
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Title Annotation:AU Optronics Corp.
Author:Liang, Quincy
Publication:The Taiwan Economic News
Article Type:Brief article
Date:May 23, 2012
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