Cree, Lextar join hands in $83M supply deal
Cree Inc. has inked a deal with Lextar Electronics Corp., a vertically-integrated LED company from Taiwan, which will see Cree invest $83 million in Lextar. The companies will also go into a supply agreement for sapphire-based LED chips.
As part of the agreement, Cree will invest about $83 million to purchase 83 million Lextar shares. Lextar and Cree will also enter into a long-term LED chip supply agreement, as well as an agreement for certain Cree LED chip and component intellectual property. Upon closing of the investment, Cree will own nearly 13 per cent of Lextar, becoming Lextar's strategic customer in lighting market.
"Lextar has established a strong technology position and customer base in the mid- and low-power backlighting and lighting LED segments, while Cree has had outstanding performance in the high-power LED component and lighting markets," said David Su, chair and CEO of Lextar. "We strongly believe this new collaboration will increase the competitiveness of our products and technology, enabling both companies continued growth in the LED lighting market. Furthermore, the cross license of LED chip and component intellectual property will afford both Cree and Lextar the benefits from our product and technology development, thereby strengthening our mutual competitiveness in the global LED industry."
Chuck Swoboda, Cree chair and CEO, said: "Working with Lextar to supply high quality mid-power LED chips enables Cree to focus its resources on the high performance, high-power LED chips that differentiate Cree LEDs in the market. This approach provides the operational and financial flexibility to help Cree achieve the best return on our people and invested capital."
- Paul Buckley
EE Times Europe
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