Taiwan's Acorp Electronics has made a deal with the Tsinghua Tongfang Group to form a JV by merging their subsidiaries to develop the market of DVD recorders and players.

Acorp, which supplies motherboards, interface cards, multimedia ICs and optical telecom products, has also been focusing on the digital video products market and has signed a letter of intent with Tsinghua Tongfang to intensify business cooperation. One of the first steps is to merge Acorp's overseas subsidiary — T-Top — with the Chinese partner's plant and business operations in Shenzhen.

Acorp's plant at Shenzhen has four surface mount technology (SMT) lines that will be used to produce the main boards and cards for the DVD players, recorders, and other products. The back-end assembly will be done by the Tongfang plant to turn out 200,000 sets of DVD products per month. Acorp will also start marketing Tsinghua Tongfang's DVD players and recorders beginning in December. The sales campaign will be focused first on Taiwan and then to other markets. The low-end items will bear Tsinghua Tongfang brand while the more sophisticated products will use Acorp's brand names. They aim to quickly take over 40% of the DVD market share in Taiwan soon.

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