TAIPEI, TAIWAN & CAMBRIDGE, USA: Prime View International (PVI), a leading small and medium display provider and the world’s highest volume supplier of ePaper display modules, today announced that it has signed a definitive agreement to acquire E Ink Corp., a leader in electronic paper display materials and intellectual property for approximately $215 million.
The new company will expand capacity and develop improvements for ePaper display screens that are easy on the eyes, long-lasting, and highly portable. ePaper is ideal for reading of digital documents which are less wasteful, more convenient and more up-to-date than paper documents.
“The ePaper display module market will grow to over $3 billion by 2013. This market will see further growth with the emergence of color displays and flexible displays, serving eBook/eTextbook, eNewspaper/eMagazine and eDocument markets. Currently, electrophoretic display technology has more than 90% market share in the overall ePaper displays, and E Ink is the #1 supplier of electrophoretic materials," according Dr. Jennifer Colegrove, DisplaySearch’s Director of Display Technologies.
“The market for electronic book devices such as the SONY Reader and Amazon Kindle is forecasted to grow from 1.1 million units in 2008 to 20 million units in 2012, a cumulative annual growth rate of 105% over the four-year period,” said iSuppli analyst Vinita Jakhanwal, “PVI and E Ink enabled this market back in 2005 and they have been the display market leaders ever since.”
“The world is searching for green technology that saves energy and cuts waste and still provides an outstanding experience,” said Scott Liu, Chairman and CEO of PVI, “E Ink’s electronic paper meets those needs, especially in electronic publishing and mobile displays. The people in both companies will unite to provide the world’s best digital reading experience and that will benefit all our customers and end users.”
“Combining E Ink and PVI creates a single public company that is dedicated to electronic paper,” said Russ Wilcox, co-founder, President and CEO of E Ink Corp. “With a common ownership structure, we can get closer to customers around the world, streamline the supply chain, and speed up new product development.”
The deal is the capstone in a transformation at PVI over the past four years to focus on electronic paper displays. In 2005, PVI acquired the ePaper business of Philips Electronics and partnered with E Ink to provide displays for electronic books including the popular SONY Reader and the Amazon Kindle 2 and Kindle DX. PVI also invested heavily in dedicated driver chips and touch screens for ePaper, as well as flexible displays, which will be marketed later this year.
In 2008, PVI bought a 74 percent stake of Hydis Technologies of Korea, quadrupling capacity for the transistor backplanes used in ePaper.
E Ink and PVI currently support nearly 20 eBook manufacturers worldwide. In addition to electronic books, E Ink’s Vizplex imaging film is used in cellphones, signage, smartcards, memory devices, and battery indicators. E Ink sales were $18 million in the first quarter of 2009, up 157 percent over the same quarter in 2008.
With the merger, PVI gains substantial intellectual property and employee talent, while securing supply of a critical component during the rapid growth phase of the market, and adding alliances and relationships across the ePaper and flexible display industry.
E Ink will continue to supply its products across the display industry and will have access to increased operating funds to boost production and accelerate new technology and product developments.
PVI will finance the acquisition with an equity placement and a convertible bond offering led by Taiwanese securities firm KGI. The transaction is subject to shareholder and customary regulatory approval and is expected to close in the fourth quarter of 2009.
Since its inception, E Ink has collaborated with a wide range of partners to develop a global ecosystem for electronic paper displays. E Ink also amassed a portfolio of hundreds of patent applications, including 150 issued in the United States. IEEE Spectrum ranked E Ink’s patent portfolio as number three worldwide for computer peripherals and storage.
In the past 12 months, customers have announced many exciting E Ink-enabled devices.
* Oprah Winfrey endorsed Amazon’s Kindle on live television calling it “her favorite gadget”. Subsequently Amazon’s Kindle 2 has proven highly popular and the Kindle DX enters the eTextbook and eNewspaper space with a large 9.7” screen.
* SONY launched a new PRS-700 Reader with integrated touch screen.
* Chinese astronauts brought the Hanwan N510 eBook into outer space on a recent Shenzhou 7 mission.
* PVI, Epson, LG Display, PolymerVision, Hewlett-Packard and Plastic Logic demonstrated flexible active matrix displays using E Ink Vizplex imaging film.
* E Ink teamed with Esquire Magazine and Ford on the first ePaper animated magazine cover.
* In May 2009, Verizon announced the Samsung Alias 2 cellphone, with a changeable keypad made with E Ink Vizplex imaging film.
E Ink was recognized with top business and industry awards in 2008, including The Smaller Business Association of New England (SBANE) Top Innovator Award; the Boston Business Journal’s List of Boston’s Fastest Growing Companies; and, The FineTech Japan Display Components & Materials Category Grand Award, among others.
E Ink will remain headquartered in Cambridge, Mass., and plans to expand its employee base from 127 to 150 people during 2009.
PVI was advised on the acquisition by investment bank Credit Suisse and law firm Baker & McKenzie. E Ink was advised by investment bank Thomas Weisel Partners and law firm Bingham McCutchen.