samsung buys sony\'s entire stake in lcd joint venture

by:LCD Mall     2020-08-30
Samsung Electronics has agreed to buy Sony\'s entire stake in its LCD Display (LCD)joint venture.
The South Korean electronics maker said it would pay Sony 1. 08tn won ($939m; £600m)
Pay its shares in cash.
The move comes as Sony is restructuring its television business, which has been losing money for the past seven years.
Meanwhile, Samsung has become the world\'s largest maker of TVs and flat-screen TVs.
According to the agreement, Samsung will acquire all of Sony\'s S-
LCD panel manufacturing joint venture of two companies, LCD Corporation, production of S-
\"LCD is a wholly owned subsidiary of Samsung,\" Samsung said in a statement . \".
The joint venture between the two companies was established in 2004, when the global economy was booming and demand for consumer electronics surged.
However, the situation has changed dramatically over the past three years.
Global economic uncertainty triggered by the 2008 financial crisis has led to a slowdown in consumer demand.
At the same time, falling prices for LCD panels and flat screen also hurt profit margins.
\"In order to cope with such challenging conditions and strengthen their respective market competencies, the two companies have agreed to move to the new LCD panel business alliance,\" Samsung said . \".
Sony will continue to obtain LCD panels from Samsung at market prices without having to operate a manufacturing plant.
Samsung said that the full ownership of the joint venture will enable it to \"increase flexibility, speed and efficiency in panel production and commercial operations \".
Analysts said the deal was correct, especially for Sony.
Keita Wakabayashi, an analyst at Mito Securities in Tokyo, said: \"In terms of direction, this is positive . \".
\"But if they lose money on sales, people may ask why they didn\'t make the decision sooner.
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