GPS Chip Maker Rakon (NZE:RAK) To Expand China Joint Venture

Sydney, Sep 22, 2009 AEST (ABN Newswire) - New Zealand's global position system chip maker Rakon Ltd. (NZE:RAK) said Tuesday it will expand its joint manufacturing venture in China with its existing joint venture partner, Timemaker Crystal Technology Ltd., and expects the project to significantly boost sales and profits.

The new facility will build on the existing Chinese joint venture operations in Chengdu in Sichuan province in southwest China and enhance the capability of the New Zealand manufacturing facility. Construction of the first stage is expected to cost NZ$30 million through to the end of the 2011 financial year.

Rakon put its Chinese expansion on hold last year while the world was in recession. Now Rakon planned a NZ$65 million equity raising to help fund the project, which will start first stage construction this year and begin operations in 2011.

The company expects sales to grow 70% on year in the fiscal year ending March 31, 2011 and sales volumes in the second half of fiscal 2010 to rise 150% from the previous year.

Rakon is the world's leading supplier of chips that go into global positioning systems used in instruments from mobile phones to missiles.

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Michelle Liang Asia Business News Asia Bureau Tel: +61-2-9247-4344 Email: michelle.liang@abnnewswire.net