BOE “Stingy Investment” put BOE Hydis in Financial Crisis

BOE, the mother company of BOE Hydis, has been bad to is Korean stepchild. In 2003, BOE bought Hydis from Hyundai and renamed it BOE Hydis. But since then, BOE hasn’t invested all that much toward expanding BOE Hydis’ technology or capacity but instead has put most of its investment toward another TFT LCD fab located in Beijing called BOE OT. And partly because of that ill treatment, BOE Hydis is in trouble.

In the second quarter of this year, most LCD manufacturers had a difficult time due to building inventory and prices sky-diving. Because BOE Hydis is a small player, it must have hurt. Now it can’t pay up the $380 million loan that BOE took out from Korean financial outfits to purchase Hydis.

And guess what? BOE wants 3000 patents owned by BOE Hydis in return for bailing the company out. So that’s what BOE was after. Buy 3000 patents for $380 million. That’s about $127,000 for each patent. I’m not sure if that’s expensive or cheap, but the Chosun Ilbo seems to think the price is cheap. I guess if BOE got hold of 3000 patents, it could turn around and sue a few companies for many millions. Or get cross-licenses to make sure BOE OT is well fed.

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