Ennostar to Issue Shares to Build Micro-LED Fab
Ennostar (3714.TT) has indicated that it will issue 70m shares in a private placement to finance the construction of a new 6” Micro-LED wafer fab. 67.25m shares of the placement will be purchased by AU Optronics, who holds a board seat at Ennostar and 2.75m shares will be purchased by Innolux (3481.TT) (no board seat). The price will be determined based on either the average closing price 30 days before the issuance or the average of the 1st, 3rd, or 5th day closing price prior to the offering, but not less than 90% of those values. AUO will hold a 17.31% stake in Ennostar when the deal is closed
We note that AUO and Ennostar, through their relationship with Apple (AAPL) have been working toward the development of Mini-LED and Micro-LED processes to further commercialize those technologies. We believe Ennostar sees further commercialization of the technology and is building out capacity to develop a Micro-LED product line that can be sold to CE companies. There are still a number of significant bottlenecks and costs associated with the production of Micro-LEDs that make such products too expensive for mass market devices, however as those bottlenecks are removed, the technology has the ability to change the face of the display space down the road.
One of the more significant challenges to Micro-LED production is that red, green, and blue Micro-LEDs must be produced on separate wafers and then transferred to a new substrate. Given their small size and vast numbers (there are 8,294,400 LEDs of each color in a 4K display), this can be a time-consuming and therefore expensive process and can lead to a number of damaged LEDs that must be repaired. One solution that has been proposed is to produce Micro-LEDs of only one color (blue) and use red and green quantum dots to convert 2/3 of the Micro-LEDs to the proper colors. If this can be done on a usable substrate, it would eliminate or reduce the need to transfer millions of small structures and reduce production time, cost, and damage. That said, much of this is still in the developmental stage and we expect Ennostar to be working more toward a less mass production type product, perhaps one for an AR device where the size of the display or projector would be small, but in any case they seem to have AUO’s confidence that the project will have a positive long-term result.
We note that AUO and Ennostar, through their relationship with Apple (AAPL) have been working toward the development of Mini-LED and Micro-LED processes to further commercialize those technologies. We believe Ennostar sees further commercialization of the technology and is building out capacity to develop a Micro-LED product line that can be sold to CE companies. There are still a number of significant bottlenecks and costs associated with the production of Micro-LEDs that make such products too expensive for mass market devices, however as those bottlenecks are removed, the technology has the ability to change the face of the display space down the road.
One of the more significant challenges to Micro-LED production is that red, green, and blue Micro-LEDs must be produced on separate wafers and then transferred to a new substrate. Given their small size and vast numbers (there are 8,294,400 LEDs of each color in a 4K display), this can be a time-consuming and therefore expensive process and can lead to a number of damaged LEDs that must be repaired. One solution that has been proposed is to produce Micro-LEDs of only one color (blue) and use red and green quantum dots to convert 2/3 of the Micro-LEDs to the proper colors. If this can be done on a usable substrate, it would eliminate or reduce the need to transfer millions of small structures and reduce production time, cost, and damage. That said, much of this is still in the developmental stage and we expect Ennostar to be working more toward a less mass production type product, perhaps one for an AR device where the size of the display or projector would be small, but in any case they seem to have AUO’s confidence that the project will have a positive long-term result.
RSS Feed