LCD panel maker BOE Hydis files for bankruptcy, report says

LCD panel maker BOE Hydis Technology filed for bankruptcy at a local Korean court on September 11 due to losses caused by unsuccessful investments and loss of technical workforce, according to the Korean-language Digital Times.

BOE Hydis, an affiliated company of the China-based BOE Technology Group, will undergo a reorganization process through the first half of 2007 and stop bond payments of 500 billion won (about US$520 million), with component suppliers not likely to receive payment in cash from BOE Hydis any more, the paper said.

Early in August, BOE Hydis refuted a report by the Chinese-language Commercial Times that it has suspended shipments of notebook panels, as it was not able to pay its component suppliers, and the issue will likely not be solved by the end of September. The South Korea-based panel maker responded by saying it did not stop supplying notebook panels.

In addition, BOE Hydis said its parent company BOE Technology Group has prepared programs of financial support to stabilize BOE Hydis' financial status and expects the measure to soon be carried out in practice.

Korea-based Chosun Ilbo reported late in August that BOE Hydis was a step closer to bankruptcy after its creditors rejected a deal from BOE Technology Group, which wanted some 3,000 LCD patents owned by BOE Hydis in return for bailing it out. The group stopped financing the Korean firm after the creditors turned down the offer, the paper indicated.

BOE Hydis has developed, manufactured and supplied TFT LCD products since 1996. It became an affiliate of BOE Technology Group in January 2003.

The South Korea-based company runs three TFT LCD production lines that specialize in small- to medium-size applications.

Source: Company and Digital Times, compiled by DigiTimes, September 2006.

Article edited by Michael McManus