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BOE Technology Group Co Ltd has secured a US$740 million loan to develop its state-of-the-art liquid crystal display (LCD) production line.
A group of nine Chinese banks, led by the Beijing branch of China Construction Bank, agreed to provide loans to the Beijing-based electronics company in the capital on Friday.
China Development Bank, the Beijing branches of the Bank of China, the Bank of Communications, the Agricultural Bank of China, the Huaxia Bank and the China Merchants Bank, as well as Bank of Beijing and Xiamen International Bank, also jointly signed the agreement.
The loans, consisting of US$180 million of working capital over three years and US$560 million in a five-year fixed asset loan, will be used to finance the construction of the fifth generation in thin film transistor (TFT) LCD production lines.
The latest production line, on which work began in September 2003, requires a total investment of US$1.24 billion.
Upon completion of the project, the largest in China, the line will be able to produce 13 million 17-inch LCD screens annually and generate sales income of 13 to 15 billion yuan (US$1.6-1.8 billion) a year, according to Wang Dongsheng, chairman and chief executive officer of BOE Technology.
Wang pointed out that the LCD industry was both technology and capital intensive. "The loans will be beneficial for increasing our competitiveness in the future."
The syndicated loan will help not only this project but boost the city's entire electronics and information industry.
Meanwhile, President Chang Zhenming of China Construction Bank said the syndicated loan was beneficial for optimizing his bank's credit structure.
(China Daily April 9, 2005)
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