Wooree LED's New Substrate Facility Could Be Korea's Electronic Gateway into China

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Researched by Industrial Info Resources (Sugar Land, Texas)--In June, Wooree LED Company Limited, a subsidiary of Wooree ETI Company Limited (KDQ:082850) (Wooree) (Ansan, South Korea), signed a memorandum of understanding with the Economic and Technical Development Zone (ETDZ) of Yangzhou, China, to construct a light-emitting diode (LED) package substrate manufacturing facility. Wooree's new facility, which is about 1,200 kilometers south of Beijing, is the largest South Korean investment in the city's ETDZ. Currently, there are no midstream LED-related facilities in Yangzhou, which is rich with upstream manufacturing facilities and downstream application facilities. The new package substrate manufacturing facility will present the ETDZ with a midstream opportunity to fill in the gaps of its LED production scheme.

An LED package typically includes a substrate capable of thermal conductivity, contact pins, and at least one LED. Wooree's substrates utilize a heat-resistant epoxy-resin to adhere components, such as a circuit board and metal plate. LED substrates produced at the $100 million Yangzhou ETDZ facility will be included in packages to be used in BLU LED-backlit laptop displays released by LG Display (KRX:034220) (Seoul, South Korea). Domestic applications also are possible, as China is the world's largest rare-earths producer and largest electronics assembler. Yangshou's ETDZ could provide Wooree with a gateway to supplying Chinese demand for backlit LED televisions. Demand for these increased by more than 5 million units this year alone, with predictions for at least 40 million by 2014.

Wooree, along with Top Engineering Company Limited (KDQ:065130) (Paju, South Korea), began construction on the new substrate manufacturing facility in July, shortly after the memorandum of understanding was finalized, and plans to wrap up construction early next year. The two companies plan to construct and install production, housing and support equipment in order to manufacture 120,000 units of substrates per year. If the demand for LEDs holds out, as Wooree and similar companies expect, Wooree could increase production capacity of the facility as soon as 2012.

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