Hisense to raise $219 mln thorough private share placement
Shanghai. June 16. INTERFAX-CHINA - Chinese TV maker Hisense Electronic Co. Ltd. will issue no more than 150 million new shares through a private placement to raise RMB 1.5 billion ($219.42 million), the company announced on June 16.
Of the amount raised, RMB 1.25 billion ($182.85 million) will be put towards setting up a TV module production line to further reduce Hisense's reliance on upstream module manufacturers.
The remaining RMB 285.97 million ($41.83 million) will be invested in liquid crystal display (LCD) TV manufacturing.
Hisense became the first TV maker in China to deploy a self-owned module production line in September 2007. As of August 2008, the company had three completed TV module production lines with an annual production capacity of 1.5 million units.
"TV makers are greatly affected by price fluctuations in upstream module manufacturing if they have no module production capacity of their own. As such, a growing number of TV makers have been launching their own module production lines in recent years. With its three module production lines, Hisense can reduce its TV manufacturing costs by over 50 percent," Shi Hong, an industry analyst with Industrial Securities, said.
Hisense expects the new TV module production line to contribute RMB 207.99 million ($30.42 million) to its total annual revenue once it is put into operation.