Change is afoot in the flat panel display business, as Samsung Electronics (SSNLF) today said it will spin out its flat-panel liquid-crystal (LCD) display operations into a separate, wholly-owned subsidiary, and may merge it with the Samsung Mobile Display unit that makes organic light-emitting diode (OLED) screens.
Competitor LG (3550KS) already has an independently traded venture, LG Display (LPL).
As Samsung described the situation, “the new corporation will consider adopting various restructuring measures including a merger with Samsung Mobile Display and S-LCD Corporation.”
Samsung explained the spin-out was necessary as OLED technology gains greater prominence in displays:
Currently, the display market is undergoing rapid changes with OLED panels expected to fast replace LCD panels to become the mainstream. Amid this structural change of the�Display industry, adopting measures for change and innovation, including business restructuring, are essential to improve our competiveness [sic] for our Display business.
Bloomberg’s Jun Yang has more detail on the announcement, including some analyst commentary.
The spin-out is expected to happen April 1st, pending a shareholder meeting March 16th.
After a deal, Samsung will have relieved the parent company’s total liabilities by almost 3.5 trillion Korean Won, or $3 billion, to ?23.8 trillion, or $21 billion, according to the deal financials offered by Samsung. The new company would have assets of about $12 billion and liabilities of about $3 billion.
Also today, Samsung said its board had approved a previously announced decision to reabsorb its Samsung LED Ltd. venture back into the parent company.
Fin.
No comments:
Post a Comment