Samsung's screen technology business is about to get even bigger.
Samsung is now buying up Sony's share of the two companies' joint venture, S-LCD, for US$940 million, or approximately 1.08 trillion South Korean won. The acquisition will shift Sony's 50 percent of the company--minus one share--into Samsung's possession, making it the S-LCD Corporation a wholly-owned Samsung subsidiary.
The move affirmed reports out of Japan several months ago that Sony was looking to scale back its television making operations due to increasingly difficult market conditions, including the strong value of the yen against the dollar and South Korean won, and the sustained economic meltdown which has hindered consumer demand for more profitable products. The shift is intended to ease some of Sony's continuing struggle with its TV business, which has posted a loss over eight straight years !
In addition to Samsung assuming control of the company, which manufactures LCD panels for consumer electronics like televisions and mobile phones, Sony will continue to source some of its LCD panels from S-LCD. Sony said it would continue to purchase LCD panels from Samsung based on market prices.
Sony and Samsung expect to complete the hand-over by the end of January 2012. This move would position Samsung as a real 'stalwart' in the display market which is already headed by the world's largest consumer electronics brand.
