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E Ink accused of asset-stripping Hydis

SEOUL -- E Ink, the parent company of Hydis, appeared to have no concrete plans on how to run Hydis, a local manufacturer of LCDs.

Despite the uproar at the Gyeonggi-based company this month after its plants were forced to shut down by E Ink until Feb. 15, the Taiwan-based maker of electronic ink remained silent.

Neither the employees at Hydis nor E Ink offered any clue, with E Ink stating only that it was “operating legally,” and therefore, there were no problems.

“We acquired Hydis, so it's OK,” said one worker on the E Ink sales force. The public relations office could not be reached.

The workers at Hydis, particularly those at the plant, think differently.

“We want to know exactly what E Ink's plans are, because so far, all we've found out is that we can't trust them,” said Bae Jae-hyung, head of Hydis' union.

The chief bone of contention for Hydis workers is the suspicion that E Ink is asset-stripping the company by selling its core technology — more specifically, the license for Hydis' LCD technology which is considered to be just a few notches below top display makers such LG Display — to rival companies.

The act itself may be legitimate, but in that case, Bae insists that the government must initiate legislation to prevent such transfers of technology in the future.

Those close to Hydis said they weren't even sure of how the licensing was being handled. All they knew was that it was being sold, for a price.

“(Given the income source), I don't believe E Ink is going to make further investments,” said one source, declining to be identified.

Adding to Hydis' woes is the layoffs that started last year. The initial plan was to slash about 10 percent of the 1,000-staff workforce. But the number could grow, according to Bae, who said the factory was operating just three months out of the year due to a lack of funds.

This would not be the first time that Hydis suffered at the hands of a foreign owner.

Prior to E Ink's acquisition in 2008, the display maker — formerly a unit under Hyundai Electronics, the precursor to Hynix Semiconductor that was acquired by SK Group — had been exploited by China-based BOE Display.

BOE, which acquired Hydis from Hyundai, had fed Hydis' technology to its Chinese operations.

E Ink's electronic ink is supplied mainly to e-readers, such as Kindle, while the displays manufactured by Hydis are fitted into products such as the Nexus 7 tablet that was jointly developed by ASUS and Google.

1 Comment
February 3, 2013    ron@
We got a statement from E Ink replying to those accusations, basically saying they are not selling Hydis:

http://www.e-ink-info.com/whats-e-inks-hydis-korean-plant
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