Lextar, a LED subsidiary of AU Optronics (AUO), has announced its merger with Wellypower, another AUO subsidiary. Lextar noted that demand for high-power chip-on-board (COB) products has been growing, hence 2012 COB packaging product shipments are likely to show 400-500% on-year growth.

Market observers expect Lextar to report NT$600-700 million (US$20-24 million) for December revenues and sales in the first quarter of 2013 to be flat compared to the fourth quarter of 2012.

The official merger date is set for February 1, 2013. Lextar stated that the LED industry does not have an optimistic forecast for 2013, also, the industry is likely to enter a period of consolidation. Lextar currently aims to expand distribution channels.

Lextar's LED lighting is divided into two business lines, including accepting OEM orders from international lighting firms and cooperating with customers in different distribution markets. Lextar added that accepting OEM orders from international firms can help keep it up to date with market standards and trends while the latter business line can help the firm to understand the differences of each market.

Lextar pointed out that even if the market price of LED lighting reaches a sweet spot, it is unlikely to stimulate explosive demand because lighting needs time to commercialize. On the other hand, said Lextar, business lighting has been switching to LED lighting at a healthy rate, causing demand for high-power COB products to grow rapidly. Lextar stated that growth in Japan and Europe has been the strongest.

The firm has been focusing on LED tubes and panel lights and for 5630 packaging products from 0.3-1W, the brightness efficiency in the fourth quarter of 2012 has reached 150lm/W. The price-performance ratio has been increasing as well. Recently, Lextar passed US-based LM80 tests showing price-performance ratio has reached 700lm/$. In addition, the firm recently introduced 15W and 23W LED lighting products with brightness reaching 1,900-2,700 lumens, and brightness efficiency equivalent to 120-126lm/W.

Lextar believes the LED backlight penetration rate of TVs and monitors should reach 70% in 2012 and the penetration rate for large-size applications is likely to reach 90% in 2013.