Kindle display maker E Ink to be bought for $215M

E Ink Corp., the maker of the innovative display for the Amazon Kindle e-book reader, said Monday it has agreed to be acquired by a Taiwanese company for $215 million.

The buyer is Prime View International, which has been Cambridge, Massachusetts-based E Ink's partner in making "electronic ink" displays for Amazon.com Inc. and Sony Corp.

The deal will help the combined company develop color versions of its displays and mass produce them by the end of 2010, said Sriram Peruvemba, E Ink's vice president of marketing. Current models show shades of gray.

Privately held E Ink is expected to demonstrate its latest color display prototypes Tuesday at a display technology show in San Antonio.

E Ink's displays are used in e-book readers because they look similar to regular paper and consume very little power. However, they take a relatively long time to switch between images, making navigation slow.

E Ink makes the top layer of the electronic ink displays, then ships them to Prime View, which adds a bottom layer that's similar to those used in LCD panels. Prime View bought the electronic ink technology of Royal Philips Electronics NV in 2005.

E Ink, which was spun off from the Massachusetts Institute of Technology, said it had raised more than $150 million from investors, including Intel Corp., Motorola Corp. and Hearst Corp. E Ink had first-quarter revenue of $18 million. It has not revealed whether it is profitable.

Peruvemba said E Ink expects to keep its offices and factory in Massachusetts and is continuing to hire, but the headquarters of the combined company will be in Taiwan.