(Yicai Global) June 30 -- Shenzhen MTC Co. [SHE: 002429] (MTC) will partake in building an LED epitaxial wafer and chip production project in the Nanchang Hi-Tech Development Zone, in which the firm will contribute USD225 -240 million (CNY1.5 billion to 1.6 billion), equal to or just above 50 percent of the registered capital of the project company.
MTC has signed an agreement with the management committee of the Nanchang Hi-Tech Development Zone in China's southeastern Jiangxi province to invest in the production, research and development, and sales of LED epitaxial wafers and chips in the park.
The first phase of the project, with a joint investment by the two of CNY5 billion, is scheduled to start formal operations next year, the company announced yesterday.
MTC will establish a project company in the zone, per the announcement. The proposed registration fund is at least CNY3 billion and the Nanchang Hi-Tech Development Zone Management Committee will apply for key industry development funds for the project in the amount of CNY1.5 billion, not exceeding 50 percent of the registered capital of the project company. MTC will further contribute CNY1.5 billion-1.6 billion.
With the company in the LED downstream business chain scale of business expansion, the company's use of LED chips increased significantly, the implementation of the project will help promote the company's resource integration, improve the chip, packaging, application lighting, the whole industry chain layout.
The company's expansion of its business scale in the LED downstream industry, its greatly increased use of LED chips and the implementation of the above projects will promote the company's resource integration and draft the entire blueprint for the chip industry chain industry, including packaging and lighting applications, the announcement said.
After the project company goes into formal operation, the coordinated development of the LED whole industrial chain will confer new production value of CNY6 billion-7 billion upon the company.