In recent years, the LED industry has undergone multiple rounds of reshuffling, and the business models and competitive landscape of some enterprises have changed. As the industry faces new opportunities and challenges, the competition among enterprises regarding comprehensive strength has become increasingly fierce. Therefore, LED related manufacturers may transform or transfer assets to focus on their main business, in order to leverage their strong technologies and concentrate advantageous resources, clarify their development paths, better seize new opportunities, and enhance the overall profitability of the company. Recently, MLS has also made corresponding adjustments in its strategic layout.

MLS plans to withdraw his 25.8% stake in Aucksun.

Yesterday evening (10/11), MLS announced its intention to withdraw its 25.81% stake in LED chip manufacturer Huai'an Aucksun Optoelectronics through capital reduction, for a consideration of 520 million yuan. The purpose of this capital reduction is to further optimize resource allocation and fund utilization arrangements, and improve the efficiency of capital utilization. After the capital reduction is completed, MLS will no longer hold the equity of Aucksun. The registered capital of the latter will be reduced from RMB 1.35152 billion to RMB 1.00272 billion, and the equity structure will be changed to: Azure holds 94.62%, and Qinghe Investment holds 5.38%.

Previously, in addition to Aucksun, MLS also invested in the development of LED chips. After this capital reduction, MLS has only one LED chip equity company, Development Crystal, remaining in the upstream field, with a shareholding ratio of 17.34%.

Clear positioning, MLS and Aucksun aim in different directions.

The decision of MLS to no longer participate in Aucksun is largely related to the current positioning and development direction of both parties.

At the beginning of 2021, MLS changed its main business from LED packaging to lighting brand and lighting channel business. According to the latest semi annual report, MLS's main business includes brand business and intelligent manufacturing business. Brand business mainly covers lighting products such as intelligent lighting, horti lighting, health lighting, indoor lighting, general lighting, and industrial lighting. The intelligent manufacturing business includes LED packaging and LED lighting manufacturing. Among them, the main products of LED packaging are white light and RGB direct display.

Previously, Aucksun mainly focused on the field of LED lighting chips. Although the current lighting proportion is still relatively large (focusing on high-end lighting such as car lights, industrial and commercial lighting, and plant lighting), Aucksun has begun to transform into the display field of Mini LED backlight. Currently, Mini LED backlight products have been shipped in large quantities, mainly for TV applications. In the short term, the development focus of Aucksun has shifted to Mini LED backlighting. In the medium to long term, Aucksun will also layout Mini LED direct display and Micro LED.

In contrast, in recent years, MLS has not made much progress in the field of Mini LED backlighting, but has mainly been active in RGB direct display areas such as small pitch and Mini LED. Although there are some similarities between the two sides in the field of lighting, from a strategic layout perspective, the synergistic advantage of Aucksun over MLS is no longer obvious. Therefore, this move is in line with the strategic development needs of MLS. Through reasonable arrangements of funds and assets, MLS is expected to play a greater role in the field of deep cultivation. (Text: LEDinside Janice)