LG Display LCD factory in Guangzhou, China. (LG Display)

According to Pulse by Maeil Business News Korea,

South Korea’s LG Display Co. is selling its liquid crystal display (LCD) plant in Guangzhou, China to China Star Optoelectronics Technology (CSOT), a subsidiary of Chinese home appliance giant TCL.

The move is expected to allow LG Display to secure 2 trillion won ($1.52 billion) in cash while shifting its business focus towards organic light-emitting diode (OLED) technology. It said on Thursday that it signed a contract to transfer its shares in the Guangzhou plant to CSOT after gaining approval from its board of directors. The sale price is set at 10.8 billion yuan ($1.54 billion), with the transaction expected to be completed by March 31st, 2025.

The Guangzhou plant primarily produces large LCD panels and modules. LG Display holds an 80 percent stake in the plant, with the remaining 20 percent owned by Guangzhou Development District. The company initially held a 70 percent stake in the plant but aimed to expedite the sale by increasing its share to 80 percent by acquiring a 10 percent stake from China’s Skyworth for 244 billion won.

With the sale, LG Display will exit the LCD TV panel manufacturing business, and there will be no Korean electronics companies producing these panels. Samsung Display Co. sold its Suzhou LCD plant to CSOT in 2021. But the industry views the latest deal positively, as it allows LG Display to concentrate on its OLED business.

“We plan to focus on enhancing our business competitiveness and establishing a stable revenue base,” a LG Display official said. “The proceeds from the sale will help strengthen our financial stability.”



By Seong Seung-hoon and Yoon Yeon-hae

Copyrights Pulse by Maeil Business News Korea. All Rights Reserved.

Source: Pulse by Maeil Business News Korea (September 27, 2024)