Kindle Manufacturer to Buy E Ink

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Taiwan-based Prime View International has signed a definitive agreement to acquire E Ink Corporation for approximately US$215 million, the two companies said in a joint statement on Monday.

Prime View and E Ink will become a dominant force in the growing electronic reader segment. Prime View manufacturers Amazon's Kindle and a number of other products, and E Ink has developed the digital-ink technology that makes electronic readers easier on the eyes compared to traditional computer screens. They support about 20 manufacturers worldwide, according to a statement.

Prime View has been building a dominant position in the electronic reader segment since it acquired the ePaper business of Philips Electronics in 2005.

The two companies see a rosy future for electronic readers. In 2008, 1.1 million units were sold, and it's expected 20 million units will sell annually by 2012, according to data from market research company iSuppli. Prime View and E Ink therefore aim to increase manufacturing capacity once the deal is finalized.

A shortage of screens has plagued the nascent electronic reader segment. One e-reader maker, Foxit Software, said in March there was a four- to six-week lead time to get more screens from E Ink, which held up production.

The transaction is expected to close in the fourth quarter of 2009.

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