Samsung Electronics has agreed to buy out Sony’s entire stake in their liquid crystal display (LCD) joint venture.<\/p>\n
The Korean electronics maker said it will pay Sony 1.08tn won ($939m; \u00a3600m) in cash for its stake.<\/p>\n
The move comes as Sony has been restructuring its TV business, which has been making a loss for the past seven years.<\/p>\n
Samsung, meanwhile, has gone on to become the world’s largest maker of TVs and flat screen panels.<\/p>\n
“Under the agreement, Samsung will acquire all of Sony’s shares of S-LCD Corporation, the two companies’ LCD panel manufacturing joint venture, making S-LCD a wholly owned subsidiary of Samsung,” Samsung Electronics said in a statement.<\/p>\n
Tough times<\/strong><\/p>\n The joint venture between two companies was established in 2004, when a boom in the global economy saw a surge in demand for consumer electronics.<\/p>\n However, things have take a dramatic turn in the last three years.<\/p>\n Triggered by the financial crisis in 2008, the subsequent global economic uncertainty has resulted in a slowdown in consumer demand.<\/p>\n At the same time, falling prices of LCD panels and flat screens have also hurt profit margins.<\/p>\n “In order to respond to such challenging conditions and to strengthen their respective market competitiveness, the two companies have agreed to shift to a new LCD panel business alliance,” Samsung said.<\/p>\n Sony will continue to get LCD panels from Samsung based on prevailing market prices, without having to operate a manufacturing facility.<\/p>\n For its part, Samsung said the full ownership of the venture will give it “heightened flexibility, speed and efficiency in both panel production and business operations”.<\/p>\n Analysts said the deal was the right move, especially for Sony.<\/p>\n “In terms of direction it is positive,” said Keita Wakabayashi, an analyst at Mito Securities in Tokyo.<\/p>\n “But if they are making a loss on the sale, one could ask why they didn’t make this decision sooner.” <\/p><\/p>\n","protected":false},"excerpt":{"rendered":" Samsung Electronics has agreed to buy out Sony’s entire stake in their liquid crystal display (LCD) joint venture. The Korean electronics maker said it will pay Sony 1.08tn won ($939m; \u00a3600m) in cash for its stake<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-22084","post","type-post","status-publish","format-standard"],"yoast_head":"\n