HSINCHU, Aug. 26, 2014 /PRNewswire/ -- Lextar Electronics Corp. (TAIEX: 3698, "Lextar" or the "Company), a vertically-integrated LED company from Taiwan, and Cree, Inc. (Nasdaq: CREE), today announced that the companies have entered into an agreement whereby Cree will make an investment in Lextar and the companies will enter into a supply agreement for sapphire-based LED chips. As part of the agreement, Cree will invest approximately $83 million to purchase 83 million Lextar shares at a price of NT$30 per share. 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 approximately 13% 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 Dr. David Su, Chairman and CEO of Lextar. "We are very excited about this new cooperation with Cree. 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."
"We are excited to be strengthening our relationship with Lextar to enable growth in LEDs and Lighting," stated Chuck Swoboda, Cree Chairman and CEO. "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."
The agreement has been approved by the boards of directors of both companies, and is targeted to close by the end of fiscal year 2014, subject to the approval of Lextar's shareholders and the Taiwan Investment Committee, and other customary closing conditions.
About Lextar Electronics
Lextar Electronics Corp. (TAIEX: 3698), founded in 2008 in Taiwan, is a subsidiary of AU Optronics, the world-class TFT-LCD and solar PV manufacturer. Lextar specializes in manufacturing high-brightness LED epitaxial, chips and packages, as well as energy-saving and smart lighting products. The range of applications includes LCD backlighting, LED light module, LED light source and luminaires. The company now houses nearly 3,500 employees and its headquarters is in the Hsinchu Science Park, Taiwan. Lextar has three manufacturing sites in Taiwan, and two in Suzhou and Xiamen respectively in mainland China. Lextar's turnover in 2013: USD 462 million. Corporate website: Lextar.com
About Cree, Inc.
Cree, Inc. is leading the LED lighting revolution and making energy-wasting traditional lighting technologies obsolete through the use of energy-efficient, mercury-free LED lighting. Cree is a market-leading innovator of lighting-class LEDs, LED lighting and semiconductor products for power and radio-frequency (RF) applications.
Cree's product families include LED fixtures and bulbs, blue and green LED chips, high-brightness LEDs, lighting-class power LEDs, power-switching devices and RF devices. Cree products are driving improvements in applications such as general illumination, electronic signs and signals, power supplies and solar inverters.
SOURCE Lextar Electronics Corp.