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Business

Chinese screenmaker to invest $3.2bn in new production lines

Local governments to take stakes alongside BOE Technology

HONG KONG (NikkeiMarkets) -- Shenzhen-listed BOE Technology Group said on Thursday that it plans to invest a total 20.02 billion yuan ($3.16 billion) in projects in China to make smartphone or television displays and expand production capacity.

BOE will invest 10 billion yuan in a production line in Chongqing city in southwestern China to make a new generation of AMOLED panels, components used in high-end display screens of mobile devices, the company said in a statement to the Shenzhen stock exchange. The production line is expected to be commissioned in 2020.

The total investment in the project is 46.5 billion yuan, out of which Chongqing's municipal government will invest 16 billion yuan. The remainder will be raised through external financing, the company said. BOE will own a 38.46% stake in the project, while Chongqing government will own 61.54%.

BOE also expects to invest six billion yuan in a TV display production line project in Wuhan city of Hebei province in central China. The project will cost a total of 46 billion yuan, with the Wuhan municipal government investing 20 billion yuan. BOE will own 23.08% of stake in the project, while the Wuhan government will own 76.92%.

The company also plans to invest 4.02 billion yuan to establish a new industrial park in Suzhou in Jiangsu province in eastern China. The industrial park covers an area of 312,606 square meters and is expected to be occupied by 2019. It will have a capacity to produce 20 million panels a year.

BOE shares in Shenzhen were up 3% on Friday. The Shenzhen Composite Index rose 0.6%.

--Carrie Chen

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