OKI to Develop New LED-Related Businesses

OKI Electric Industry (TOKYO:6703) and OKI Data Corp., which markets under the OKI Printing Solutions brand today announced that the OKI Group will increase its LED (light-emitting diode) production for print heads used in its non-impact printers, and enhance new LED-related businesses. This will be achieved by acquiring an LED production facility in Japan's Takasaki City in Gunma Prefecture with a 'clean room' that is approximately twice the area of the room used currently. OKI aims to further enhance its non-impact printer business in addition to developing new businesses using LED technology. This investment is the first step in OKI's new growth strategy, through which it plans to accelerate new business developments.

“OKI has been revamping its business structure and we now focus on two business areas: 'Info-telecom converged business' and 'mechatronics business,' which is represented by ATMs and printers. We have been shifting resources and creating strong technologies and solutions to achieve robust business growth,” said Hideichi Kawasaki, President at OKI Electric Industry. “This is the first of many decisions I will be making with regard to developing new businesses to accelerate our growth strategy. I believe that increasing our LED production capacity will enable us to apply our competitive LED technology not only to our printers but also to new areas, such as ultra small displays, where growth is expected.”

OKI's LED technology is currently used in the print heads as a light source for its non impact printers. The Group also develops “Epi Film Bonding (EFB) technology” in which without the need for adhesives, thin film material is bonded by utilizing the intermolecular bonding force working to hold the film together. OKI was the first in the world to successfully manufacture this technology for commercial use, and expects to deploy it in various applications.

The new facility will be acquired under a basic agreement concluded between OKI Data and Renesas Technology Corp., in which OKI Digital Imaging Corp. (ODI) will acquire the land (3,521m2), buildings (9043m2 in area), and utilities of the former semiconductor front-end process line (Takasaki, Gunma Prefecture) of the Gunma Development Design and Device Division of Renesas Eastern Japan Semiconductor, Inc. ODI will acquire this at the end of November 2009, and operations at the new location are scheduled to start in April 2010, after ODI relocates to Takasaki.

“With a clean room that has a high level of cleanliness and which doubles our current capacity, OKI Data expects to boost its LED print head production by fourfold. This will help us double our non impact printer sales by the fiscal year ending March 2012,” said Harushige Sugimoto, President and CEO of OKI Data. “We also expect stronger synergy between the development team and the production team as the new location will be close to OKI Data's Taksaki plant, which, I believe, will then enhance our product development capabilities.”

The average annual growth rate of the global non impact printer market (excluding ink jet) for business-use, is said to be 5%, and the market size will increase from 21 million units in 2009 to about 25 million units in 2013. (Source: IDC Q1 2009) OKI Group aims to increase its market share in this growing market by boosting LED print head production and realizing greater commercial value.

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