BOE Technology to buy 50% equity interest in BMCC

Oct. 9, 2009 (China Knowledge) - BOE Technology Group Co Ltd<000725><200725>, one of the largest LCD producers in China, plans to buy a 50% equity interest in Beijing Matsushita Color CRT Co Ltd from Matsushita Toshiba Picture Display Co Ltd.

BOE Technology said in a statement filed with the Shenzhen Stock Exchange that it will pay a token fee of US$100 in exchange for the equity interest.

BOE Technology will hold an 80% equity interest in BMCC after the deal.

The transaction was prompted by the shrinking market for BMCC's main products. BMCC adjusted its business strategy and decided to quit the CRT market because LCD panels are gradually replacing CRT screens. Although the Chinese LCD producer said it held a positive view of the transaction, some market participants expect that the deal will have a negative impact due to the gloomy outlook on the CRT industry.

BMCC posted a loss of RMB 745 million for the first eight months of the year. Its net assets were RMB 430 million as of Aug. 31, 2009. BOE Technology recorded a net loss of RMB 749 million for the first half of this year.