At the same time, GE announced that it had entered a "strategic alliance agreement to support GELcore" with Nichia Corporation, one of the world's leading LED manufacturers. Specifics were not revealed, but this will most likely involve Nichia continuing to supply LEDs to GELcore, and the two companies sharing IP in device technology and phosphor development.
GELcore, based in Cleveland, Ohio, was established in 1999 as a joint venture between GE, one of the world's leading lighting manufacturers, and Emcore, a provider of compound semiconductor-based components and subsystems. Somerset, NJ-based Emcore is a former manufacturer of metal-organic chemical vapor deposition (MOCVD) tools that are used to grow LED device structures.
|GELcore Tetra Power White XL|
By teaming with Nichia, GE will be able to make up lost ground on its rival lighting giants, Philips and Osram. Both these companies are now vertically integrated, to different extents, with the capability to manufacture LEDs in-house and integrate them into modules and systems. Philips recently acquired Agilent's share of high-power LED specialist Lumileds, while Osram has an in-house LED unit, Osram Opto Semiconductors.
Another major Japanese LED maker, Toyoda Gosei, has formed Lexedis Lighting, a joint venture with a subsidiary of Zumtobel, a major European lighting manufacturer. The deal between GE and Nichia leaves Cree as the most significant LED manufacturer without a formal relationship with a lighting manufacturer.
GE says that the agreement with Nichia combines GELcore's LED system strengths in the Transportation, Signage, Specialty Illumination, and General Illumination segments with Nichia's extensive phosphor and optoelectronics products, such as LEDs. Both companies expect to benefit significantly from each other's expertise and penetrate the high-growth LED general illumination segment.
"This agreement is a true win-win outcome for both parties and clearly demonstrates GE's commitment to solid-state lighting technology," said Michael Petras, VP of Electrical Distribution & Lighting at GE. "GE and Nichia's combined excellence creates a preeminent alliance that is ideally suited to support GELcore's efforts to accelerate the growth and penetration of LED-based lighting solutions in the $12 billion global lighting segment."
Noboru Tazaki, Executive Vice President & COO of Nichia, states, "This is a historic agreement when you consider that GE, a world leader in traditional lighting technology and LED systems and Nichia, a world leader in phosphor and optoelectronics technology, are joining forces to advance LED technology and accelerate the penetration of LEDs into the general lighting industry."
GELcore is believed to be on target to generate revenues of around $100 million in 2006 – see GELcore quarterly loss hides underlying growth.
Emcore says that its cumulative share of losses since GELcore's formation through June 30, 2006 total approximately $16.1 million. In 2005, GELcore recorded a net loss of $0.8 million, compared with $2.5 million net income recorded in 2004. For the six months ended June 30, 2006, GELcore recorded a net loss of $1.3 million.